Figure 23-1
-Refer to Figure 23-1.If the economy is at a level of aggregate expenditure given by point K
A)the economy is in equilibrium.
B)production is greater than spending.
C)production is less than spending.
D)inventories will increase above their desired level.

Question

Figure 23-1 
-Refer to Figure 23-1.If the economy is at a level of aggregate expenditure given by point K
A)the economy is in equilibrium. 
B)production is greater than spending. 
C)production is less than spending. 
D)inventories will increase above their desired level.

Quizplus · Accepted Answer

Point K represents the point where aggregate expenditure equals real GDP, indicating that the economy is in equilibrium. Therefore, option A is the correct choice.

Figure 23-1 -Refer to Figure 23-1.If the Economy Is at a Level