Use the Figure Below to Answer the Following Questions

question 48

Multiple Choice

Use the figure below to answer the following questions.

Figure 27.2.2
The economy depicted does not engage in international trade and has no government. Planned aggregate expenditure (AE) is equal to the sum of consumption expenditure (C) and investment (I) .
-Refer to Figure 27.2.2. Equilibrium expenditure is

• A)$100 billion.
• B)$300 billion.
• C)$250 billion.
• D)$200 billion.
• E)$400 billion.

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Definitions:

Money Market

A section of the financial market where short-term financial assets with high liquidity are traded.

Interest Rate

The amount charged by lenders as a percentage of the principal, or the amount earned on deposits over a specified period.

Equilibrium Value

The point at which the quantity of a good or service demanded equals the quantity supplied, resulting in market stability.

Opportunity Cost

Whatever must be given up to obtain some item.