Which of the following is an equilibrium condition of the short-run macro model?
A) Taxes equal transfers.
B) Imports equal exports.
C) Aggregate expenditure equals output.
D) Consumption spending equals autonomous consumption spending.
E) Consumption spending equals investment spending plus government spending.

Question

Quizplus · Accepted Answer

In the short-run macro model, equilibrium is achieved when aggregate expenditure equals output. This means that total spending in the economy is equal to total production. Therefore, choice C is the correct answer. The other choices are not equilibrium conditions in this model.

Which of the Following Is an Equilibrium Condition of the Short-Run