Answer to Question #67396 in Macroeconomics for Mariana Felix

Question

In a private closed economy, When aggregate expenditures equal GDP _______
A planned investments equals saving
B disposable income equals consumption minus saving
C consumption equals investment
D consumption equals aggregate expenditure

Answer 1

The right answer is A. The explanation can be found from Keynes cross theory. Where it is said that when the economy is in the equilibrium it means that planned investments should be equal to savings