Use the following table to answer the next question.The table shows a consumption schedule. All figures are in billions of dollars.RGDPConsumption$600$580640610680640720670760700If gross investment was $20 billion, government purchases of goods and services were $20 billion, and taxes and net exports were zero, then the equilibrium level of real GDP would be
A. $680 billion.
B. $720 billion.
C. $600 billion.
D. $640 billion.
Answer: A
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A government ban on a good that suffers from overconsumption may be ineffective if the:
A. likelihood of being caught breaking the ban is sufficiently high. B. likelihood of being caught breaking the ban is very low. C. punishment for breaking the ban is severe. D. public did not participate in setting the punishments.
In perfect price discrimination, which of the following are reduced to zero?
a. Consumer surplus and producer surplus b. Producer surplus and deadweight loss c. Consumer surplus and deadweight loss d. Producer surplus and total welfare
Suppose there are 3 possible outcomes to a vote: A, B, and C. If voters prefer A to B, C to B, and A to C, which of the following concepts are violated?
a. Transitivity b. Median Voter Theorem c. Arrow's Impossibility Theorem d. None of the above concepts are violated
In Ugoland, the money supply is $8 million and reserves are $1 million. Assuming that people hold only deposits and no currency, and that banks hold no excess reserves, then the reserve requirement is
a. 14 percent. b. 12.5 percent. c. 8 percent. d. None of the above is correct.