Final answer:
When the aggregate expenditure line crosses the 45-degree line, it signifies the state of macroeconomic equilibrium where total expenditure equals total income in the economy.
Step-by-step explanation:
When the aggregate expenditure line crosses the 45-degree line, it signifies that the total expenditure in the economy is equal to the total income earned in the economy. In other words, it represents a state of macroeconomic equilibrium. At this intersection, aggregate demand equals aggregate supply, leading to a stable level of output and income.
For example, if a country's aggregate expenditure line crosses the 45-degree line at a GDP level of $10 trillion, it means that the total spending by households, businesses, and the government is equal to the total income generated by all sectors of the economy. This equilibrium state indicates that there is no excess demand or supply in the economy.