By the end of this section, you will be able to: Explain what the expenditure-output model/Keynesian cross diagram shows and what the equilibrium point on the diagram represents. Analyze the consumption function, investment function, government spending, taxes, imports and exports is relation to the expenditure-output model. Analyze the location of an equilibrium point on an expenditure-output model to determine characteristics of the economy, including the presence of a recessionary gap or an inflationary gap. Evaluate the stability of an economy based on the multiplier effect in relation to the expenditure-output model.

Concepts

aggregate demand

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Additional Tags

expenditure-output model, ap macroeconomics, texas gateway, texas gateway: chapter 11: the expenditure-output or keynesian cross model, the expenditure-output or keynesian cross model, government expenditures

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Classroom Considerations

• Knovation Readability Score: 5 (1 low difficulty, 5 high difficulty)
• The intended use for this resource is Instructional|practice