Ab 26 Economics The graph below models an economy in equilibrium with a real GDP of $180 billion. Suppose thatconsumer's expectations about future incomes change, causing unplanned inventory investment toincrease by $30 billion. Shift the Planned Aggregate Expenditure (AE) line to show the effect of thischange.Planned Aggregate Spending (in billions of dollars)30027024021018015030Planned AE0 306045° line90 120 150 180 210Real GDP (in billions of dollars)240 270 300This change will cause theequilibrium level of real GDP to:remain unchanged.decrease.increase.How much will GDP changeonce the new equilibrium isreached? (If GDP decreases,be sure to include a negativesign.)Numberbillion dollars

Planned Aggregate Expenditure (PAE) is a macroeconomic concept that represents the total planned…

he graph below models an economy in equilibrium with a real GDP of $180 billion. Suppose that nsumer's expectations about future incomes change, causing unplanned inventory investment to crease by $30 billion. Shift the Planned Aggregate Expenditure (AE) line to show the effect of this ange. 300 270 5 240 210 180 150 120 Planned AE 45° line This change will cause the equilibrium level of real GDP to: remain unchanged. decrease. increase. How much will GDP change once the new equilibrium is reached? (If GDP decreases, be sure to include a negative sign.) Number billion dollars

he graph below models an economy in equilibrium with a real GDP of $180 billion. Suppose that nsumer's expectations about future incomes change, causing unplanned inventory investment to crease by $30 billion. Shift the Planned Aggregate Expenditure (AE) line to show the effect of this ange. 300 270 5 240 210 180 150 120 Planned AE 45° line This change will cause the equilibrium level of real GDP to: remain unchanged. decrease. increase. How much will GDP change once the new equilibrium is reached? (If GDP decreases, be sure to include a negative sign.) Number billion dollars

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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