QUESTION 21 Refer to the information provided in Figure 8.9 below to answer the questions that follow. AE 225 200 175 150 45° 100 200 300 Aggregate output ($ millions) Figure 8.9 Refer to Figure 8.9. $200 million is O the break even income. O where saving equals aggregate expenditures. O where saving equals consumption. O the equilibrium income. Aggregate expenditures (%$ millions)
QUESTION 21 Refer to the information provided in Figure 8.9 below to answer the questions that follow. AE 225 200 175 150 45° 100 200 300 Aggregate output ($ millions) Figure 8.9 Refer to Figure 8.9. $200 million is O the break even income. O where saving equals aggregate expenditures. O where saving equals consumption. O the equilibrium income. Aggregate expenditures (%$ millions)
Chapter1: Making Economics Decisions
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Transcribed Image Text:### Question 21
Refer to the information provided in Figure 8.9 below to answer the questions that follow.
### Figure 8.9
The diagram in Figure 8.9 depicts a graph with the following components:
- **X-Axis:** This represents Aggregate Output in millions of dollars, with values marked at intervals of 100, ranging from 0 to 300.
- **Y-Axis:** This represents Aggregate Expenditures in millions of dollars, with values marked at intervals of 25, ranging from 0 to 225.
- **45° Line:** A 45-degree line extends diagonally from the origin (0,0) up to the highest values on the x and y axes, representing points where aggregate expenditures equal aggregate output.
- **AE Line:** A second line labeled AE extends from below the 45° line on the left to above the 45° line on the right, indicating varying levels of aggregate expenditures relative to aggregate output.
- **Intersection Point:** There is a highlighted point where the AE line intersects with the 45-degree line. The coordinates for the intersection point align with the values of approximately 200 on the x-axis and 200 on the y-axis, indicating that at this point, aggregate expenditures equal aggregate output.
### Multiple Choice Question:
Refer to Figure 8.9. $200 million is:
- ☐ the break even income.
- ☐ where saving equals aggregate expenditures.
- ☐ where saving equals consumption.
- ☐ the equilibrium income.
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