The Country of Nemedia Does Not Trade with Any Other

question 61

Multiple Choice

The country of Nemedia does not trade with any other country. Its GDP is $20 billion. Its government collects $4 billion in taxes and pays out $3 billion to households in the form of transfer payments. Consumption equals $15 billion, and investment equals $2 billion. What is the value of the goods and services purchased by the government of Nemedia?

• A)$3 billion
• B)$5 billion
• C)$17billion
• D)There is not enough information to answer the question.

---

Definitions:

Marginal Cost

The price associated with manufacturing one more unit of a product or service.

Average Total Cost

The sum of all production expenses divided by the amount of goods produced.

Fixed Costs

Costs that do not vary with the level of production or services provided.

Marginal Cost Curve

A graphical representation that shows how the marginal cost of producing additional units changes with the level of output.