These equations/expressions are always true (definitions of terms are below each equation, but are not repeated):

(1)

C + S = DI

(C = consumption expenditure, S = savings, DI = disposable income)

(2)

DI = Y - T

(Y = real income (GDP), T = tax revenues)

(3)

AE = C + I + G + (X - M)

(AE = aggregate expenditures, I = autonomous investment, G = government expenditure, X = exports, M = imports)

(4)

(MPC = marginal propensity to consume [we sometimes abbreviate it as "m"])

(5)

(MPS = marginal propensity to save [we sometimes abbreviate it as "1-m"])

(6)

(APC = average propensity to consume)

(7)

(APS = average propensity to save [also called the savings rate])

At equilibrium (only) in the fixed price level model of AE it's true that:

(8)

Y* = C + I + G + (X - M)

(Y* = equilibrium real income (GDP))