Refer to the information provided in Table 24.2 below to answer the question(s) that follow.
Table 24.2
-Refer to Equation 24.2. At equilibrium leakages in Canada equal

Question

Refer to the information provided in Table 24.2 below to answer the question(s) that follow.
Table 24.2 
-Refer to Equation 24.2. At equilibrium leakages in Canada equal

Quizplus · Accepted Answer

At equilibrium, Y = C + I + G + NX, which means leakages (S) must equal injections (I). From the table, we know that S = $2,000 (Savings) + $1,000 (Taxes) + $500 (Imports) = $3,500. Therefore, I = $3,500. Looking at the equations in the table, we can see that I = $1,800 (Investment) + $700 (Government Spending) + X (Exports). Solving for X, we get X = $1,800 + $700 - $3,500 = $1,000. This means that leakages in Canada (S = $3,500) must equal injections (I = $3,500), which is achieved at an equilibrium level of exports (X) of $1,000.

Refer to the Information Provided in Table 24