Refer to the Accompanying National Income Data (In Billions of

question 179

Multiple Choice

$$\begin{array} { | l | r | } \hline \text { Disposable Income } & \$ 200 \\\hline \text { Net Private Domestic Investment } & 40 \\\hline \text { US Imports } & 15 \\\hline \text { National Income } & 300 \\\hline \text { Personal Taxes } & 31 \\\hline \text { Net Exports } & 9 \\\hline \text { Gross Private Domestic Investment } & 55 \\\hline \text { Net Foreign Factor Income } & 10 \\\hline \text { Statistical Discrepancy } & 0 \\\hline\end{array}$$ Refer to the accompanying national income data (in billions of dollars) . In these data, U.S. GDP is

• A) $315 billion.
• B) $324 billion.
• C) $305 billion.
• D) $367 billion.

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Definitions:

Long Run

A period in economic theory during which all inputs can be adjusted by firms, allowing them to fully adapt to changes in market conditions or to scale their operations.

Sales

The transactions or activities involved in selling goods or services in return for money or other compensation.

Fixed Costs

Expenses that do not change in proportion to the activity of a business, such as rent, salaries, or insurance premiums.

Negative Returns

A situation in which an increase in the amount of inputs used leads to a decrease in the level of output, often seen in cases of over-investment or inefficient production processes.