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AE Model: Private Open Economy
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Problem 10
AE Model: Private Open Economy
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15. Deriving the Aggregate Expenditures Model / AE Model: Private Open Economy / Problem 6
Problem 6
Why are government purchases absent in the aggregate expenditures model of a private open economy?
A
Because government purchases are included in consumption.
B
Because the model assumes no government involvement.
C
Because government purchases are included in net exports.
D
Because government purchases are included in investment.
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