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Aggregate Expenditures Model and Macroeconomic Equilibrium
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Aggregate Expenditures Model and Macroeconomic Equilibrium
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16. Deriving the Aggregate Expenditures Model / Aggregate Expenditures Model and Macroeconomic Equilibrium / Problem 8
Problem 8
Why is consumption expected to increase with rising GDP?
A
Because increased GDP leads to higher disposable income.
B
Because investment becomes variable.
C
Because government purchases decrease.
D
Because net exports increase.
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