Final answer:
In the short-run equilibrium, aggregate expenditures must always be equal to real GDP. This is represented by the intersection on the 45-degree line in a Keynesian cross diagram. In the long run, the economy will self-correct to potential GDP according to neoclassical economics.
Step-by-step explanation:
In the short run equilibrium of the macroeconomy, it is always true that aggregate expenditures in the economy are equal to the real GDP. By definition, GDP measures the total value of final goods and services produced within a country during a specific period. For an economy to be in equilibrium, the Keynesian cross diagram illustrates that the point where the aggregate expenditure curve intersects the 45-degree line represents the equilibrium level of output where aggregate expenditure and output are equal.
Furthermore, considering a perfectly competitive market in equilibrium, firms produce output where price equals marginal revenue (MR) equals marginal cost (MC), and the price equals average cost (AC). Demand fluctuations may cause short-run adjustments, but in the long run, normal profits are achieved, and the economy returns to its potential GDP. Neoclassical economics also suggests that short-run fluctuations in unemployment and aggregate demand only have temporary effects, as the economy eventually self-corrects.