When Does the Equilibrium Quantity of Aggregate Output Occur

question 31

Multiple Choice

When does the equilibrium quantity of aggregate output occur?  

• A) when the economy reaches the full employment of labour 
• B) when planned aggregate expenditure equals income generated from production 
• C) when actual aggregate expenditures equal real GDP 
• D) when inventories of goods and services are increasing

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Definitions:

Cash Flow

A financial term describing the net amount of cash and cash-equivalents being transferred into and out of a business.

Firm's Assets

All owned resources with economic value that an entity (firm) possesses, anticipated to provide future benefits.

Money Market Funds

Investment funds that invest in short-term debt securities, such as treasury bills and commercial paper, offering investors high liquidity with a very low level of risk.

Bondholders

Individuals or entities who own debt securities issued by corporations or governments, effectively lending them money.