The aggregate expenditure function in the simple macro model of this chapter is written as AEequals

$$

Upper C Subscript a Baseline plus Upper I Subscript a Baseline plus Upper G Subscript a Baseline plus left parenthesis Upper X Subscript a Baseline minus IM Subscript a Baseline right parenthesis

Upper C plus Upper I plus Upper G plus left parenthesis Upper X minus IM right parenthesis

a plus bY

$,$ and is graphed with

$$

actual aggregate expenditure

desired aggregate expenditure

expected aggregate expenditure

on the vertical axis and

$$

actual national income

expected national income

desired national income

on the horizontal axis.