Instructions: Enter your answers as a whole number. a. What is the equilibrium level of output at AE1? billion The economy experiences an increase in investment of $150 billion, shifting aggregate expenditures to AE2. b. At initial equilibrium output level, the increase in investment will result in what amount of aggregate expenditures? billion c. The increase in aggregate expenditures will cause an increase in output (income). By how much will output increase due to the additional income generated from the increased investment? billion d. The increase in income will lead to an additional increase in expenditures. By how much will expenditures increase due to the increase in income previously calculated? LA billion e. This process will continue until reaching the final equilibrium. What is the equilibrium output when aggregate expenditures are AE2? billion34 The graph below depicts the economy in equilibrium at AE1. 0.81 Equilibrium Dynamics points AE=Y 600 eBook AE, 550 References 500 450 400 AE, 350 Aggregate Expenditures (billions of dollars) 300 250 200 150 50 0 50 100 150 200 250 300 350 400 450 500 600 Real GDP (billions of dollars)