Net exports are $20, consumption spending is $40, government spending is $10 and aggregate income is $100. Therefore, business investment spending is $30.

Question

Quizplus · Accepted Answer

Aggregate income (Y) is equal to the sum of consumption (C), investment (I), government spending (G), and net exports (NX). Given Y = $100, C = $40, G = $10, and NX = $20, we can solve for I: $100 = $40 + I + $10 + $20, which simplifies to I = $30.

Net Exports Are $20, Consumption Spending Is $40, Government Spending