The following schedule contains data for a private closed economy.All figures are in billions.
Assume that gross investment is $10 billion.
-Refer to the above data.If gross investment remains at $10 at all levels of GDP,the after-tax equilibrium level of GDP will be:
Definitions:
Equilibrium GDP
Equilibrium GDP, or Gross Domestic Product, is the level of output where aggregate demand equals aggregate supply, resulting in no unintended changes in inventories.
Inflationary Gap
This term reflects the difference between the actual output of an economy and the maximum potential output it could achieve with full employment, often indicating inflation pressures.
Equilibrium GDP
The level of Gross Domestic Product at which the total quantity of goods and services produced equals the total quantity of goods and services purchased.
Deflationary Gap
A condition in which aggregate demand is lower than the aggregate supply potentially leading to deflation.
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