Consider a Simple Aggregate Expenditure Model Where All Components of Aggregate

question 154

Multiple Choice

Consider a simple aggregate expenditure model where all components of aggregate expenditure are autonomous except consumption. If the consumption function is
C = $500 + 0.8Y, planned investment = $200, government purchases = $300,
Net exports = $100, and real GDP = $1,000, what is the amount of induced expenditures?

• A) $500
• B) $800
• C) $1,100
• D) $1,900

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Definitions:

ISO14031

A standard providing guidance on performance evaluation for environmental management within an organization.

Environmental Management Accounting

A form of accounting that captures environmental costs and integrates them into business decision-making processes to enhance environmental and economic performance.

Supply Chain Management

Supply Chain Management is the oversight of materials, information, and finances as they move from supplier to manufacturer to wholesaler to retailer to consumer.

Traditional Management Accounting Systems

Accounting practices that focus primarily on financial information and cost control to aid management in decision-making.