In a Simple Macro Model with No Government and No

question 91

Multiple Choice

In a simple macro model with no government and no foreign trade, the equilibrium level of national income is the level of income at which

• A)aggregate desired expenditure is greater than actual national income.
• B)saving equals consumer spending.
• C)aggregate desired expenditure equals consumer spending.
• D)saving equals income.
• E)aggregate desired expenditure equals actual national income.

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Definitions:

Total Production

The complete quantity of goods and services produced by an economic entity in a certain period.

Opportunity Costs

The potential benefits or returns that are foregone by choosing one alternative over another.

Trade Price

The price at which goods or services are traded between companies, often lower than retail price.

International Trade

The exchange of goods, services, and capital between countries or territories, influenced by comparative advantage, tariffs, and trade agreements.