Exam 26: Demand-Side Equilibrium: Unemployment or Inflation?

If the amount that consumers wish to save at the full employment level of income is greater than the amount that businesses plan to invest, then

Using the standard 45-degree line diagram, how does an increase in investment spending effect the expenditure schedule?

The multiplier principle explains how

Market economies are likely to suffer from recessions and inflation because the government plans all economic activity.

If total spending is greater than the value of output, firms will

One of the primary functions of markets could be labeled

One of the possible consequences of the expenditure schedule lying below the level of full employment GDP is

Equilibrium GDP will not exist where output exceeds aggregate demand because businesses will notice that

The full employment level of GDP is sometimes referred to as "potential GDP."

What is meant by the concept of a "coordination failure" in macroeconomics?