In the Very Short Run, the Components of Aggregate Planned

question 441

Multiple Choice

In the very short run, the components of aggregate planned expenditure that depend on the level of real GDP are

• A) planned consumption expenditure and planned imports.
• B) planned investment and planned imports.
• C) planned investment and planned exports.
• D) planned government expenditure on goods and services and planned imports.

---

Definitions:

Risk Characteristics

The inherent features of an investment that determine its potential return and the likelihood of loss.

Risk-Free Rate

The theoretical rate of return on an investment with zero risk, typically associated with government bonds.

Market Risk Premium

The extra return that investors require to hold a risky market portfolio instead of risk-free assets.

Beta

A measure of the volatility, or systematic risk, of a security or a portfolio in comparison to the market as a whole.