Saved Check my work mode: This shows what is correct or incorrect for the work you have completed so far. It does not indicate xpenditures Model: Homework a. What is the equilibrium level of output at AE₁? $ 200 billion The economy experiences an increase in investment of $150 billion, shifting aggregate expenditures to AE2. b. At initial equilibrium output level, the increase in investment will result in what amount of aggregate expenditures? $ 350 billion c. The increase in aggregate expenditures will cause an increase in output (income). By how much will output increase due to the additional income generated from the increased investment? 150 billion d. The increase in income will lead to an additional increase in expenditures. By how much will expenditures increase due to the increase in income previously calculated? e. This process will continue until reaching the final equilibrium. What is the equilibrium output when aggregate expenditures are AE2? $ 500 billion 500 billion JUL 1 ? 15 874 80 F3 $ #3 000 000 F4 55 % F5 < Prev 9 of 10 Next > 66 MacBook Air F6 & N 7 AA F7 חי E R T Y U D F G H C V 8 * 0 W DII AD FB F9 F10 - 61 K O O P 9 5 points The graph below depicts the economy in equilibrium at AE1. Equilibrium Dynamics eBook Print References Mc Graw Hill 600 550 500 450 400 350 300 250 200 150 100 50 AE=Y AE (550, 500) AE, Aggregate Expenditures (billions of dollars) 600 550 500 450 300 250 200 100 150 Real GDP (billions of dollars) 400 350 < Prev 9 of 10 Next >
Saved Check my work mode: This shows what is correct or incorrect for the work you have completed so far. It does not indicate xpenditures Model: Homework a. What is the equilibrium level of output at AE₁? $ 200 billion The economy experiences an increase in investment of $150 billion, shifting aggregate expenditures to AE2. b. At initial equilibrium output level, the increase in investment will result in what amount of aggregate expenditures? $ 350 billion c. The increase in aggregate expenditures will cause an increase in output (income). By how much will output increase due to the additional income generated from the increased investment? 150 billion d. The increase in income will lead to an additional increase in expenditures. By how much will expenditures increase due to the increase in income previously calculated? e. This process will continue until reaching the final equilibrium. What is the equilibrium output when aggregate expenditures are AE2? $ 500 billion 500 billion JUL 1 ? 15 874 80 F3 $ #3 000 000 F4 55 % F5 < Prev 9 of 10 Next > 66 MacBook Air F6 & N 7 AA F7 חי E R T Y U D F G H C V 8 * 0 W DII AD FB F9 F10 - 61 K O O P 9 5 points The graph below depicts the economy in equilibrium at AE1. Equilibrium Dynamics eBook Print References Mc Graw Hill 600 550 500 450 400 350 300 250 200 150 100 50 AE=Y AE (550, 500) AE, Aggregate Expenditures (billions of dollars) 600 550 500 450 300 250 200 100 150 Real GDP (billions of dollars) 400 350 < Prev 9 of 10 Next >
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
Related questions
Question
I need help with d. only
Transcribed Image Text:Saved
Check my work mode: This shows what is correct or incorrect for the work you have completed so far. It does not indicate
xpenditures Model: Homework
a. What is the equilibrium level of output at AE₁?
$
200
billion
The economy experiences an increase in investment of $150 billion, shifting aggregate expenditures to AE2.
b. At initial equilibrium output level, the increase in investment will result in what amount of aggregate expenditures?
$
350
billion
c. The increase in aggregate expenditures will cause an increase in output (income). By how much will output increase due to the
additional income generated from the increased investment?
150
billion
d. The increase in income will lead to an additional increase in expenditures. By how much will expenditures increase due to the
increase in income previously calculated?
e. This process will continue until reaching the final equilibrium. What is the equilibrium output when aggregate expenditures are AE2?
$
500
billion
500
billion
JUL 1
? 15
874
80
F3
$
#3
000
000
F4
55
%
F5
< Prev
9 of 10
Next >
66
MacBook Air
F6
&
N
7
AA
F7
חי
E
R
T
Y
U
D
F
G
H
C
V
8
* 0
W
DII
AD
FB
F9
F10
-
61
K
O
O
P
Transcribed Image Text:9
5
points
The graph below depicts the economy in equilibrium at AE1.
Equilibrium Dynamics
eBook
Print
References
Mc
Graw
Hill
600
550
500
450
400
350
300
250
200
150
100
50
AE=Y
AE
(550, 500)
AE,
Aggregate Expenditures (billions of dollars)
600
550
500
450
300
250
200
100
150
Real GDP (billions of dollars)
400
350
< Prev
9 of 10
Next >
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