Meaning of 45 degree in economics chart

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The **45-degree line** in economics and geometry refers to a line where the values on the x-axis and y-axis are equal at every point. It typically has a slope of 1, meaning that for every unit increase along the horizontal axis (x), there is an equal unit increase along the vertical axis (y). Here are a couple of contexts where the 45-degree line is significant:

### 1. **In Macroeconomics:**
- The 45-degree line is often used in the **Keynesian cross model** (or income-expenditure model). In this model, the 45-degree line represents all points where **aggregate output (or GDP)** equals **aggregate demand (or expenditure)**. Where this line intersects the aggregate expenditure curve marks the equilibrium level of output, showing that the total output produced is equal to the total demand in the economy.

### 2. **In Geometry:**
- A 45-degree line is simply a line where the slope is 1, meaning it rises or falls at a 45-degree angle. It forms a perfect diagonal in a square coordinate system where the x and y axes are scaled equally.

In both contexts, the 45-degree line helps visualize situations where two variables are in a one-to-one relationship.

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