determine(s) the level of real GDP.Multiple choice question.Aggregate savingAggregate expendituresAggregate supplyAggregate demand

To determine the level of real GDP from the options provided, we need to consider the relationships between these concepts in the context of the economy.

1. Aggregate Demand (AD): Represents the total demand for goods and services within an economy at a given overall price level and in a given time period. It can be seen as the sum of consumption, investment, government spending, and net exports.

2. Aggregate Supply (AS): Represents the total supply of goods and services that firms in an economy plan on selling during a specific time period. It reflects how production output of an economy responds to changes in overall price levels.

3. Aggregate Expenditures (AE): Total spending on the nation’s goods and services. It includes consumption, investment, government spending, and net exports, and is often used in conjunction with aggregate demand.

4. Aggregate Saving: This represents the portion of income that is not consumed. It is related to how much households and businesses are able to save versus spend.

Analysis:

Real GDP is ultimately determined by the level of output being produced in an economy, which aligns closely with aggregate supply and aggregate demand. However, the most direct measure when discussing the overall economy and output is aggregate demand (AD), as this encompasses total spending and is used to gauge economic activity.

Final Answer

Aggregate Demand is the concept that directly relates to determining the level of real GDP in the context of the choices given.