Suppose Exports Are $200 and Imports Are Given by IM

question 21

Multiple Choice

Suppose exports are $200 and imports are given by IM = 0.2Y. At what level of national income will net exports equal zero?

• A)$1000
• B)$1250
• C)$0
• D)$200
• E)$250

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Definitions:

Reported Income

Reported income is the total earnings a company reports on its income statement, computed as the net income after taxes, interest, depreciation, and other expenses.

Recognition of Revenue

The process of recording revenue in the financial statements when it is earned and measurable, according to set criteria.

Financial Reporting

Creating reports that unveil the financial standing of a company to its executives, shareholders, and regulatory authorities.

Tax Law

The body of law governing taxation, including regulations on income, corporate, sales, and property taxes, as administered by governmental entities.