Question

In: Economics

Table A shows gross domestic product (GDP), disposable income (DY), consumer spending (C), and planned investment...

Table A shows gross domestic product (GDP), disposable income (DY), consumer spending (C), and planned investment spending (IPlanned) in an economy. Assume there is no government or foreign sector in this economy.

Table A

GDP DY C IPlanned AE IUnplanned
1000 1000 1400 300
1500 1500 1775 300
2000 2000 2150 300 A
2500 2500 2525 300 B
3000 3000 2900 300
3500 3500 3275 300
3800 3800 3500 300
4200 4200 3800 300

Refer to Table A and fill the blank “A” by calculating planned aggregate spending (AE).

1,700

4,100

2,825

2,450

Solutions

Expert Solution

Ans- The correct answer is 2450.

Solution:-

As we know:-

Aggregate expenditure=Consumption+investment (Planned)

Aggregate expenditure (point A)=2150+300

Aggregate expenditure (point A)=2450


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