A small open economy, Nevaco's real GDP is $100,000, the MPS is 0.20, and the marginal propensity to consume foreign goods is 0.10. All else being the same, if Nevaco's real GDP decreases by $10,000, then the decrease in its total consumption is the decrease in consumption of goods produced in Nevaco is ________, and the decrease in its trading partners ___is_ O $8,000; $2,000; imports; $1,000 O $10,000; $8,000; exports; $2,000 O $8,000; $7,000; exports; $1,000 $10,000; $10,000; imports; $1,000

A small open economy, Nevaco's real GDP is $100,000, the MPS is 0.20, and the marginal propensity to consume foreign goods is 0.10. All else being the same, if Nevaco's real GDP decreases by $10,000, then the decrease in its total consumption is the decrease in consumption of goods produced in Nevaco is ______, and the decrease in its trading partners _is_ O $8,000; $2,000; imports; $1,000 O $10,000; $8,000; exports; $2,000 O $8,000; $7,000; exports; $1,000 $10,000; $10,000; imports; $1,000

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter23: The International Trade And Capital Flows

Section: Chapter Questions

Problem 8SCQ: State whether each of the following events Involves a financial flow to the U.S. economy or away...

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Question

A small open economy, Nevaco's real GDP is $100,000, the MPS is
0.20, and the marginal propensity to consume foreign goods is 0.10.
All else being the same, if Nevaco's real GDP decreases by $10,000,
then the decrease in its total consumption is the decrease in
consumption of goods produced in Nevaco is_______, and the decrease
in its trading partners___is_
$8,000; $2,000; imports; $1,000
O $10,000; $8,000; exports; $2,000
O $8,000; $7,000; exports; $1,000
$10,000; $10,000; imports; $1,000

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