21.2 Equilibrium National Income FIGURE 21-3

Multiple Choice

21.2 Equilibrium National Income FIGURE 21-3
-Refer to Figure 21-3.Consider the simplest macro model with no government and no foreign trade,and the aggregate expenditure function AE = C + I.If there was zero autonomous expenditure and the marginal propensity to consume was equal to one,then the AE function would be

A) steeper than the 45-degree line.
B) above the 45-degree line at all points.
C) below the 45-degree line at all points.
D) coincident with the 45-degree line.
E) flatter than the 45-degree line.