Refer to the Below Diagram, Which Aggregate Expenditure (AE) Schedule

question 41

Multiple Choice

Refer to the below diagram, which aggregate expenditure (AE) schedule for a private closed economy implies the largest MPC?

• A)AE₄
• B)AE₃
• C)AE₂
• D)AE₁

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Definitions:

Always Decrease

A scenario where a variable or condition consistently declines over a period of time without increasing.

Marginal Cost

The cost associated with producing one additional unit of a product, emphasizing the incremental expense in production processes.

Additional Unit

The next unit of product or service that is being considered for production or consumption.

Marginal Cost

Incremental expense incurred from the production of one additional unit of a good.