FIGURE 21-3 -Refer to Figure 21-3.If National Income Is Y₃ and the and the Aggregate

question 32

Multiple Choice

FIGURE 21-3
-Refer to Figure 21-3.If national income is Y₃ and the aggregate expenditure function is AE₁,

• A)the economy is in equilibrium.
• B)there is unintended inventory accumulation and income will rise.
• C)there is unintended inventory accumulation and income will fall.
• D)there is unintended inventory decumulation and income will rise.
• E)there is unintended inventory decumulation and income will fall.

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Definitions:

Standard Deviation

A measure of the amount of variation or dispersion of a set of values, indicating how much the values in a data set deviate from the mean.

Mean High Temperature

Mean high temperature is the average of the highest temperatures over a specific time period for a particular place.

Book Value

The net value of an asset according to its balance sheet account balance, calculated as the original cost minus accumulated depreciation.

Variable Manufacturing Costs

Expenses that change in proportion to the amount of goods or services produced, including direct materials and labor.