Assume a Closed Economy

question 83

Multiple Choice

Assume a closed economy.If consumption spending is $6.2 trillion,investment spending is $2.5 trillion,net taxes are $1.5 trillion and total income is $11 trillion,how much must government purchases be?

• A) $2.3 trillion
• B) $0.8 trillion
• C) $3.3 trillion
• D) $7 trillion
• E) cannot be determined without more information

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Definitions:

Machine-Hours

A measure of production time using machinery; used as a basis for allocating manufacturing overhead costs to products.

Machine-Hours

A measure of the total time that machines are operating during a specific period.

Direct Labor-Hours

The total amount of time spent by workers directly involved in the production of goods, measured in hours.

Total Job Cost

The cumulative cost of materials, labor, and overhead for a specific job, useful in tracking expenses and determining profitability for that job.