The table below shows national income and imports.The level of exports is fixed at $300.All figures in the table and in the questions are in millions of dollars. TABLE 22-1 Refer to Table 22-1.On a graph of the net export function for this economy,at what level of Y would the NX function intersect the horizontal axis?
A)at $0
B)at $2000
C)at $3500
D)at $4000
E)at $5000

Question

The table below shows national income and imports.The level of exports is fixed at $300.All figures in the table and in the questions are in millions of dollars.  TABLE 22-1 Refer to Table 22-1.On a graph of the net export function for this economy,at what level of Y would the NX function intersect the horizontal axis?
A)at $0 
B)at $2000 
C)at $3500 
D)at $4000 
E)at $5000

Quizplus · Accepted Answer

The net export function can be calculated by subtracting imports from exports, which in this case would be:
NX = Exports - Imports
NX = 300 - (0.1Y - 100)
NX = -0.1Y + 400
Setting this equal to zero to find the level of Y where NX intersects the horizontal axis gives us:
-0.1Y + 400 = 0
Y = 4000
Therefore, the answer is D: at $4000.

The Table Below Shows National Income and Imports