Question

In an economy where GDP equals 100, consumption equals 67, investment equals 14, and government purchases equal 21,

a) exports must exceed imports by 2.

b) taxes must exceed government purchases by 2.

c) imports must exceed exports by 2.

d) net exports must equal 2.

e) none of the above.

Answer #1

The correct answer is 'Option C'.

The GDP is equal to the sum of consumption expenditure (C), investment expenditure (I) and government spending (G).

The sum of C, I and G is 67 + 14 + 21 = 102. But, the value of GDP is given as 100. So, the net exports must be negative. The net exports is the amount by which the exports exceed imports. For net exports to be negative, the value of imports must exceed the value of exports. Therefore, the correct answer is 'Option C'.

An economy has GDP of 10,000; consumption of 6,000; government
purchases of 1,000 and investment of 2,500.
Net Exports = _______________; and Net Capital Outflow =
_____________
What is the effect of an increase in the government purchases
on
Net Exports (Increase or Decrease) and
on Net Capital Outflow (Increase or Decrease)

An economy has GDP of 10,000;
consumption of 6,000; government purchases of 1,000 and investment
of 2,500.
Net Exports = _______________; and Net Capital Outflow =
_____________
What is the effect of an increase in the government purchases
on
Net Exports (Increase or Decrease) and
on Net Capital Outflow (Increase or Decrease)

Calculate GDP for an economy that has consumer purchases of
$6,000, investment purchases of $1,000, government purchases of
$2,500, total exports of $1,000, and total imports of $500

The table below shows the national accounts for a hypothetical
economy, Macronia.
($ billions)
Government purchases
17
Proprietors' income and rents
11
Exports
5
Indirect taxes
9
Gross investment
13
Wages and salaries
29
Corporate income
21
Imports
5
Net investment
9
Personal consumption
30
Statistical discrepancy
?
a. The expenditure-based estimate of Macronia's GDP is
$ billion.
b. The income-based estimate of Macronia's GDP is
$ billion.
c. The value of the statistical discrepancy which is added to the
lower estimate...

Suppose the current GDP is $11.3 trillion. Assuming that
consumption is $6.7 trillion, investment is $2.1 trillion, exports
are$1.8 trillion, and imports are $1.4 trillion, government
purchases are $___ trillion.
If GDP measured in billions of current dollars is $5,465,
consumption is $3,657, investment is $741, and net exports are
–$1,910, then government purchases are:

The rental value of an owner-occupied house is included in which
component of GDP?
Consumption
Intermediate value
Fixed investment
None of the above
Which of the following components of GDP is the largest for the
US economy?
Consumption
Investment
Government purchases
Net exports

Personal consumption expenditure 200, Personal Taxes 50, Exports
30, Depreciation 10, Government Purchases 50, Gross private
domestic Investment 40, Imports 40, Government transfer payments
20:
Please show and give an explanation to your answers
provided
a. What is the value of GDP?
b. What is the value of net domestic product?
c. What is the value of net investment
d. What is the value of net exports?
e. What is the value of disposable income?

Calculate the GDP for a country with investment of $2 trillion,
government purchases of $3 trillion, capital depreciation of $1.5
trillion, consumption of $10 trillion, exports of $3.4 trillion,
and imports of $3.9 trillion. Show your work.

The economy of Beverly Hills has a consumption function of C =
10 + 0.8Y, investment equal to
6, government expenditure equal to 10, exports equal to 10, and an
import function of M = 0.1Y.
1) Refer to Fact 27.5.1. What is the equation for the aggregate
expenditure curve for this
economy?
A) AE = 16 + 0.7Y
B) AE = 36 - 0.7Y
C) AE = 26 + 0.8Y
D) AE = 36 + 0.9Y
E) AE =...

In a simple closed economy where there is no government and
investment, the consumption function of households is given by
C(Y)=60+0.6Y. The potential output in this economy at 450. What is
the expenditure multiplier in this economy?
Select one:
a. 0.40
b. 1.66
c. 2.5
d. 0.60
e. None of the other four choices

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