what-does-a-point-above-the-45-degree-line-on-the-aggregate-expenditures-graph-i

Question

What does a point above the 45-degree line on the aggregate expenditures graph indicate?

Accepted Answer

Aggregate expenditures exceed GDP, suggesting an increase in production is needed.

Answer

The economy is at full employment.

Answer

The economy is in a state of deflation.

Answer

GDP exceeds aggregate expenditures, suggesting a decrease in production is needed.