$$\begin{array} { | l | r | }
\hline \text { Personal Consumption Expenditures } & \$ 4,500 \
\hline \text { Consumption of Fixed Capital } & 150 \
\hline \text { Gross Private Domestic Investment } & 800 \
\hline \text { Government Purchases } & 950 \
\hline \text { Exports } & 65 \
\hline \text { Imports } & 85 \
\hline
\end{array}$$ Refer to the accompanying data about a hypothetical economy (in billions of dollars). How much are net exports of this economy?
A) +$150 billion
B) ?$20 billion
C) +$20 billion
D) ?$65 billion

Question

$$\begin{array} { | l | r | } 
\hline \text { Personal Consumption Expenditures } & \$ 4,500 \
\hline \text { Consumption of Fixed Capital } & 150 \
\hline \text { Gross Private Domestic Investment } & 800 \
\hline \text { Government Purchases } & 950 \
\hline \text { Exports } & 65 \
\hline \text { Imports } & 85 \
\hline
\end{array}$$ Refer to the accompanying data about a hypothetical economy (in billions of dollars). How much are net exports of this economy?
A) +$150 billion
B) ?$20 billion
C) +$20 billion
D) ?$65 billion

Quizplus · Accepted Answer

To calculate net exports, we subtract imports from exports. So, net exports = exports - imports. From the given data, exports are $200 billion and imports are $220 billion. Therefore, net exports = $200 billion - $220 billion = -$20 billion. The negative sign indicates that this economy has a trade deficit.

Refer to the Accompanying Data About a Hypothetical Economy (In