Section 1
Introducing Aggregate Expenditure
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Defining Aggregate Expenditure: Components and Comparison to GDP
Aggregate expenditure is the current value of all the finished goods and services in the economy.
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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.
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Graphing Equilibrium
An economy is said to be at equilibrium when the aggregate expenditure is equal to the aggregate supply (production) in the economy.
![Thumbnail](../../../../../../figures.boundless-cdn.com/20714/square/1953-recession-in-us.jpeg)
The Multiplier Effect
When the fiscal multiplier exceeds one, the resulting impact on the national income is called the multiplier effect.