Use the Information Below to Answer the Following Questions

question 153

Multiple Choice

Use the information below to answer the following questions.
Fact 27.5.1
The economy of Beverly Hills has a consumption function of C = 10 + 0.8Y, investment equal to 6, government expenditure equal to 10, exports equal to 10, and an import function of M = 0.1Y.
-Refer to Fact 27.5.1. What is equilibrium real GDP in this economy?

• A)36
• B)120
• C)130
• D)360
• E)none of the above

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Definitions:

Average Rate of Return

A financial ratio that calculates the expected return on an investment relative to its initial cost.

US Dollar

The official currency of the United States, widely used as a benchmark and reserve currency worldwide.

Investments

Assets or items acquired with the goal of generating income or appreciation in value.

Exchange Rate

The value of one currency for the purpose of conversion to another, crucial for international trade and investments.