In the simple Keynesian aggregate expenditure model, the equilibrium level of disposable income is achieved when:
A)the employment rate is equal to the labor force participation rate.
B)saving equals investment.
C)aggregate expenditures exceed output.
D)aggregate expenditures are equal to real disposable income.

Question

Quizplus · Accepted Answer

Aggregate expenditures are equal to real disposable income when the economy is in equilibrium.

In the Simple Keynesian Aggregate Expenditure Model, the Equilibrium Level