1. What is the equilibrium rGDP in this economy? 2. What happens to Jusiness inventories at...

  

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1. What is the equilibrium rGDP in this economy? 2. What happens to Jusiness inventories at point a? 3. If the MPC is 0.5 and there is an increase in autonomous investment of $30 billion, how much will rGDP increase? Use the graph to answer the questions Aggregate Expenditures (billions) 500 400 300 200 100 Aggregate Expenditures Model 45° line a b C 100 200 300 400 Real GDP 500 AE₁ 1. What is the equilibrium rGDP in this economy? 2. What happens to Jusiness inventories at point a? 3. If the MPC is 0.5 and there is an increase in autonomous investment of $30 billion, how much will rGDP increase? Use the graph to answer the questions Aggregate Expenditures (billions) 500 400 300 200 100 Aggregate Expenditures Model 45° line a b C 100 200 300 400 Real GDP 500 AE₁

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Solution 1 The equilibrium rGDP in this economy is 400 billion Thi... View the full answer