Table 131Canada's Saving,Investment,Import,and Export Functions (In Billions of Dollars) Under a a System

question 39

Multiple Choice

Table 13.1.Canada's Saving,Investment,Import,and Export Functions (in billions of dollars) Under a System of Fixed Exchange Rates
Export Function X = 3000
Investment Function I = 1000
Saving Function S = -1000 + 0.2Y
Import Function M = 500 + 0.25Y
-Refer to Table 13.1.If improved business optimism leads to increases in Canada's planned investment spending from $1000 billion to $1200 billion,Canada's equilibrium income rises by approximately:

• A) $444 billion
• B) $555 billion
• C) $666 billion
• D) $777 billion

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Definitions:

Price Elasticity Of Demand

An indicator of the sensitivity of demand for a product to fluctuations in its price.

Quantity Of Tickets

The number of tickets available or sold for an event.

Total-Revenue Curve

A graphical representation that shows how total revenue changes as the quantity sold of a product or service changes.

Linear Demand Curve

A graphical representation of demand where the relationship between price and quantity demanded is a straight line, indicating constant marginal change.