Use the following table to answer the next question. All figures in the table are in billions. RGDPC + IExportsImports$500$525$15$1055056015106005951510650630151070066515107507001510The equilibrium level of real GDP in this private open economy is
A. $700 billion.
B. $600 billion.
C. $650 billion.
D. $550 billion.
Answer: B
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Suppose the conditions of the first welfare theorem hold. If the government redistributes income prior to production and trade occurring, the market outcome (resulting from production and trade) will be efficient so long as no deadweight loss is produced in the levying of redistributive taxation.
Answer the following statement true (T) or false (F)
Social cooperation by means of voluntary contracts and exchanges
A) cannot occur in a socialist economic system. B) cannot occur where government sets rules that restrict behavior. C) is easier to achieve when the laws of the society are clear and unchanging. D) is harder to achieve when the members of the society own very little material property in common.
The year in which euro coins and paper currency were introduced and participating "euro zone" countries withdrew old domestic currencies from circulation was
A) 2007. B) 2002. C) 1999. D) 1995.
Consider a perfectly competitive market in which the firms are earning above-normal profit in the short run. In the long run, forces will come into play to
a. decrease market supply b. shift the horizontal demand curve facing each firm downward c. increase the market price d. encourage existing firms to increase output e. decrease the number of sellers in the market