When the Aggregate Expenditure Curve Is Above the 45 Degree

question 5

Multiple Choice

When the aggregate expenditure curve is above the 45 degree line:

• A) there will be excess demand in the economy and GDP will increase
• B) there will be insufficient demand in the economy and GDP will decrease
• C) there will be insufficient demand in the economy and GDP will increase
• D) there will be excess demand in the economy and GDP will decrease

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