In a Certain Economy in 2005,government Purchases Exceeded Investment by $2,000;investment

question 113

Multiple Choice

In a certain economy in 2005,government purchases exceeded investment by $2,000;investment amounted to 1/6 of GDP;consumption amounted to 1/2 of GDP;and the economy's imports exceeded its exports by $500.It follows that GDP amounted to

• A)$4,500.
• B)$7,500.
• C)$9,000.
• D)$10,500.

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Definitions:

Minimal Government Intervention

Minimal government intervention refers to an economic policy or philosophy where the government has a very limited role in the economy, allowing the market to operate with minimal regulatory influence.

Market System

An economic system where decisions regarding investment, production, and distribution are guided by the price signals created by the forces of supply and demand.

Self-interest

Acting in a way that is most beneficial for oneself.

Private Property

The right of private persons and firms to obtain, own, control, employ, dispose of, and bequeath land, capital, and other property.