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How does the constant nature of investment, government purchases, and net exports simplify the aggregate expenditures model?
If government purchases increase by \$10 billion and the multiplier is 2, what is the expected increase in GDP?
What does a point above the 45-degree line on the aggregate expenditures graph indicate?
If the aggregate expenditures line is above the 45-degree line, what adjustment is likely to occur in the economy?
In a private closed economy, what happens when aggregate expenditures exceed GDP?
Given the consumption function C = 60 + 0.9Y and investment of 20, what is the equilibrium GDP?
Why is the 45-degree line important in the aggregate expenditures model?
In a graph of a private open economy, what does the intersection of the aggregate expenditures line and the 45-degree line represent?
What are the implications of a high marginal propensity to consume (MPC) on the multiplier effect?
How do varying marginal propensities to consume (MPC) affect the size of the multiplier effect?
In the AE model, what does macroeconomic equilibrium signify?
If the marginal propensity to consume (MPC) is 0.8, what is the value of the multiplier?
If consumption increases by \$30 in an economy with an MPC of 0.5, what is the expected change in GDP?