In the Aggregate Expenditures Model, If Aggregate Expenditures (AE)equals $7

question 5

True/False

In the aggregate expenditures model, if aggregate expenditures (AE)equals $7 trillion and GDP equals $8 trillion, then inventory accumulation equals $1 trillion.

---

Definitions:

Arbitrageurs

Individuals or entities that take advantage of price differences in different markets by buying low in one and selling high in another to make profits.

Central Banks

Major financial institutions that manage a country's currency supply, interest rates, and serve as a lender of last resort to the banking sector.

Exchange Rates

The price at which one currency can be exchanged for another currency.

Fluctuate

To change or cause to change in level, strength, or value frequently, without steadiness or consistency.