According to the Aggregate Expenditure Model, When Autonomous Expenditure Increases

question 36

Multiple Choice

According to the aggregate expenditure model, when autonomous expenditure increases, equilibrium expenditure

• A)increases by a smaller amount.
• B)does not change because autonomous expenditures has no effect on equilibrium expenditure.
• C)increases by a larger amount.
• D)increases by an equal amount.
• E)does not change because only induced expenditures increase equilibrium expenditure.

---

Definitions:

Interest

The charge for borrowing money, typically expressed as an annual percentage of the principal amount.

Quarter

A three-month period on the financial calendar that companies use to report their earnings and performance.

Account

A document detailing all the transactions related to a particular element within the accounting equation.

Ordinary Annuity

Invariable payments issued at the terminal of consecutive intervals over an exact length of existence.