If National Income Is Demand- Determined, the Condition for National

question 94

Multiple Choice

If national income is demand- determined, the condition for national income to be in equilibrium can be stated as:

• A)AE must be greater than Y.
• B)actual saving equals actual investment.
• C)unemployment must equal the natural unemployment rate.
• D)desired saving equals actual investment.
• E)desired aggregate expenditure equals the actual level of national income.

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Definitions:

Windfall Theory

Windfall theory suggests that unexpected, unearned, or sudden gains (windfalls) in wealth can have various effects on individuals’ behavior, the economy, or market dynamics.

Merchant

A person or company engaged in the wholesale or retail sale of goods or services.

Authorized Dealer

An entity or individual officially recognized and permitted by a manufacturer or government to sell or distribute specific products or services.

Homemade Furniture

Furniture created by individuals rather than manufactured by companies, often characterized by its unique design and the personal touch of its maker.