Which of the Following Best Describes Aggregate Expenditure

question 9

Multiple Choice

Which of the following best describes aggregate expenditure?

• A)C + I + G + (X − M)
• B)C + S + G + (X − M)
• C)C + I + G + (X + M)
• D)C + I + T + (X − M)
• E)C + I + T + (X + M)

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Definitions:

Time Horizon

The length of time over which an investment, project, or policy is intended or expected to operate or have an impact.

Demand Curve

A demand curve is a graphical representation that shows the relationship between the price of a good and the quantity demanded by consumers over a certain period.

Law of Supply

An economic principle stating that as the price of a good or service increases, the quantity supplied of that good or service also increases, all else being equal.

Price-Elasticity

A measure of the responsiveness of demand or supply of a good or service to changes in its price.