Which of the following statements is true?
A)A recession occurs when the expenditure line shifts down the 45-degree line.
B)A recession occurs whenever potential GDP is less than real GDP at the point of spending balance.
C)A recession occurs whenever income and expenditures are not equal.
D)A recession occurs when the expenditure line crosses the 45-degree line at a level of income less than potential GDP.
E)The expenditure line cannot be used to identify recessions or expansions.

Question

Quizplus · Accepted Answer

The Answer of Which of the following statements is true?
A)A recession occurs when the expenditure line shifts down the 45-degree line.
B)A recession occurs whenever potential GDP is less than real GDP at the point of spending balance.
C)A recession occurs whenever income and expenditures are not equal.
D)A recession occurs when the expenditure line crosses the 45-degree line at a level of income less than potential GDP.
E)The expenditure line cannot be used to identify recessions or expansions.

Which of the Following Statements Is True