Refer to the Tables of Information for a Private Closed

question 11

Multiple Choice

$$\begin{array}{l}\begin{array} { | c | c | } \hline \text { Gross Domestic Product } & \text { Consumption } \\\hline \$ 100 & \$ 120 \\\hline 200 & 180 \\\hline 300 & 240 \\\hline 400 & 300 \\\hline 500 & 360 \\\hline\end{array}\\\\\begin{array} { | c | c | } \hline \text { Expected Rate of Return } & \text { Amount of Investment } \\\hline 25 \% & \$ 0 \\\hline 20 & 20 \\\hline 15 & 40 \\\hline 10 & 60 \\\hline 5 & 80 \\\hline\end{array}\end{array}$$ Refer to the tables of information for a private closed economy. If the real interest rate is 10 percent, the equilibrium GDP will be

• A) $100.
• B) $200.
• C) $300.
• D) $400.

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Definitions:

Net Income

The amount of profit left after all expenses, taxes, and costs have been subtracted from total revenue.

Corporate Tax Rate

The share of a business's profits that is remitted to the government as taxation.

Variable Costs

Costs that vary in relation to a company's operational activities, like labor and material expenditures.

Fixed Costs

Fixed costs are business expenses that remain constant regardless of the level of production or business activity, such as rent, salaries, and insurance.