Use the following table with data for a private open economy (no government) to answer the next question.All figures are in billions of dollars. Real GDPC + INet Exports$400$420$20450460205005002055054020600580206506202070066020If net exports increased by $10 billion at each level of GDP, the equilibrium real GDP would be
A. not determinable using this table.
B. $610.
C. $700.
D. $650.
Answer: D
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In the above figure, when real disposable income is less than 600, then
A) consumption is less than disposable income. B) consumption is the same as disposable income. C) consumption is more than disposable income. D) the MPC will fall.
A classical model of the economy predicts
A) full employment in the long run. B) a 15 to 20 percent unemployment level whenever the economy is in equilibrium. C) the same unemployment rates as the Keynesian model. D) cyclical changes in the unemployment rate.
High-wage workers are
a. more likely than low-wage workers to supply more labor when the wage rate rises. b. about as likely as low-wage workers to supply more labor when the wage rate rises. c. less likely than low-wage workers to supply more labor when the wage rate rises. d. The available evidence does not indicate how high-wage workers and low-wage workers differ in responding to changes in the wage rate.
Which of the following macroeconomic variables would be drawn accurately as perfectly inelastic?
A. Aggregate demand B. Long-run aggregate supply C. Short-run aggregate supply D. None of these should be drawn as perfectly inelastic.