If the Value of Exports Equals $6

question 109

Multiple Choice

If the value of exports equals $6.5 billion and the value of imports equals $8.0 billion in a year,then:

• A)together imports and exports add $1.5 billion to the gross domestic product (GDP).
• B)together exports and imports add $6.5 billion to the gross domestic product (GDP).
• C)together exports and imports reduce the gross domestic product (GDP)by 1.5 billion.
• D)together exports and imports add nothing to the gross domestic product (GDP).

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Definitions:

Firm Commitment

A guarantee given by an underwriter to purchase all the unsold shares in an initial public offering or a secondary offering.

Financial Responsibility

The ability to manage one's financial resources wisely, including saving, investing, and spending in a manner that ensures long-term financial stability.

Syndicate Buys

Refers to a group of investors or underwriters pooling together to buy the entire or a large portion of a new securities issue for resale.

Dutch Auction

A method of public offering in which the price of the offering is set after taking in all bids and determining the highest price at which the total offering can be sold.