In the Simplest Macroeconomic Model,with a Closed Economy and No

question 86

Multiple Choice

In the simplest macroeconomic model,with a closed economy and no government,the aggregate expenditure (AE) function is the sum of

• A)saving and desired investment.
• B)consumption and disposable income.
• C)desired consumption and desired investment.
• D)consumption and saving.
• E)actual consumption and actual investment.

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Definitions:

Cash Inflow

The total amount of money being transferred into a business, from operations, financing or investing activities, over a specific period of time.

Cash Flows

The cumulative sum of funds moving into and exiting a company, notably influencing its liquidity.

Cash Outflow

Outgoing payments in cash from a company to cover expenses, investments, and financing activities.

Sunk Costs

Costs that have already been incurred and cannot be recovered, which should not influence ongoing investment decisions.