Use the Following to Answer Questions

question 2

Multiple Choice

Use the following to answer questions .
Exhibit: Aggregate Expenditures (AE) in a Simplified Economy

-(Exhibit: Aggregate Expenditures (AE) in a Simplified Economy) Consider a simple economy that is made up of only two sectors, households and firms, and that investment is autonomous. Further, disposable personal income = real GDP. Suppose that actual real GDP in this economy is $300 billion in a particular period. We would expect to see

• A) unintended reductions in inventory, planned investment will exceed actual investment.
• B) unintended reductions in inventory, planned investment will be less than actual investment.
• C) unintended increases in inventory, planned investment will exceed actual investment.
• D) unintended increases in inventory, planned investment will be less than actual investment.

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Definitions:

Sigma Bonding

A type of covalent bond where electrons are shared in an area directly between atoms, involving the overlap of atomic orbitals.

Molecular Orbital

A region in a molecule where an electron is likely to be found, described by a mathematical function reflecting the wave-like properties of electrons.

Cylindrically Symmetric

Refers to objects or systems that have rotational symmetry about a central axis, maintaining the same dimensions in a circular pattern around the axis.

Molecular Orbital

A mathematical function describing the wave-like behavior of an electron in a molecule.