Other Things Being Equal, How Will a Decrease in an Economy's

question 54

Multiple Choice

Other things being equal, how will a decrease in an economy's exports affect aggregate expenditures and output?  

• A) Domestic aggregate expenditures will increase, and the equilibrium level of output will increase. 
• B) Domestic aggregate expenditures will decrease, and the equilibrium level of output will increase. 
• C) Domestic aggregate expenditures will remain the same, and the equilibrium level of output will remain the same. 
• D) Aggregate expenditures will be negative, and equilibrium level of output will decline.

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Definitions:

Liabilities

Financial obligations or debts that a company owes to outside parties, which must be settled over time through the transfer of economic benefits.

Office Equipment

Durable assets used in an office setting for daily operations, such as computers, printers, and furniture.