Why do we subtract import spending from total expenditures?
What will be an ideal response?
Import spending is defined as spending on goods and services that are produced in foreign countries. When we total up consumption expenditures, investment spending, and government spending, this total includes spending on goods and services, regardless of where they are produced. That is, it includes some import spending. We must then subtract the value of import spending from total expenditures because we would be including spending on goods and services that is not the result of production of newly produced goods and services in the United States. We want total expenditures to reflect expenditures on final goods and services produced in the domestic economy.
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Use the following table to answer the question below.Quantity DemandedPriceQuantity Supplied5$7966875784693510241113If demand decreased by 4 units at each price, what would the new equilibrium price and quantity be?
A. $6 and 8 units B. $5 and 7 units C. $3 and 5 units D. $4 and 6 units
Table 11-1 Quantity (units)18161412104Price per unit (dollars)123 4 5 6 Total cost (dollars)44 3832262014Table 11-1 shows demand and total cost schedules for Monopoliteria. At the profit-maximizing output, what quantity is Monopoliteria producing?
A. 10 B. 12 C. 14 D. 16
A society can improve environmental quality at the lowest cost when pollution is reduced by
What will be an ideal response?
New classical economists say that a fully anticipated decrease in aggregate demand:
A. shifts the long-run aggregate supply curve to the right. B. shifts the long-run aggregate supply curve to the left. C. moves the economy down along its vertical long-run aggregate supply curve. D. eventually results in a self-correcting increase in aggregate demand.