Equations for C,I,G,and NX Are Given Below

question 247

Multiple Choice

Equations for C,I,G,and NX are given below.If the equilibrium level of GDP is $32,000,what is the marginal propensity to consume? C = 5,000 + (MPC) Y
I = 1,500
G = 2,000
NX = -500

• A)0.67
• B)0.75
• C)0.8
• D)0.9

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Definitions:

Fabricating Department

A division within a manufacturing company dedicated to the construction and assembly of the parts required to produce a finished product.

FIFO Method

An inventory valuation method that assumes that the first items placed in inventory are the first sold, standing for First-In, First-Out.

Equivalent Units

A concept in cost accounting used to convert partially completed goods into an equivalent number of fully completed units for inventory valuation.

Direct Materials

The raw materials used in the manufacturing process that are directly incorporated into the finished product.