In the Keynesian cross diagram, the point at which the aggregate demand function crosses the 45-degree line indicates the :

CA Foundation · Business Economics · MTP · January 2025
In the Keynesian cross diagram, the point at which the aggregate demand function crosses the 45-degree line indicates the :
(A) A. level of full employment income.
(B) B. less than full employment level of income.
(C) C. equilibrium level of income which may or may not be full employment level of income
(D) D. autonomous level of income which may not be full employmentlevel of income

Suggested Answer and Working Notes:

Correct Answer: Option (C)

C. equilibrium level of income which may or may not be full employment level of income

Topics: International Trade

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