4 concepts
Defining Aggregate Expenditure: Components and Comparison to GDP
Aggregate expenditure is the current value of all the finished goods and services in the economy.
Aggregate Expenditure at Economic Equilibrium
An economy is said to be at equilibrium when aggregate expenditure is equal to the aggregate supply (production) in the economy.
Graphing Equilibrium
An economy is said to be at equilibrium when the aggregate expenditure is equal to the aggregate supply (production) in the economy.
The Multiplier Effect
When the fiscal multiplier exceeds one, the resulting impact on the national income is called the multiplier effect.