The Table Given Below Reports the Value of Real GDP

The table given below reports the value of real GDP and its components consumption (C) , investment (I) , exports, and imports for two consecutive years.
Table 10.3
$\begin{array}{l}\begin{array}{|c|c|c|c|c|c|}\hline & \text { Equilibrium } & & & & \\\hline & \text { Real GDP } & \text { C } & \text { I } & \text { Exports } & \text { Imports } \\\hline \text { Year 1 } & \$ 9,350 & \$ 7,500 & \$ 1,350 & \$ 1,800 & - \\\hline \text { Year 2 } & \$ 11,450 & \$ 8,900 & - & \$ 2,350 & \$ 1,600 \\\hline\end{array}\\\text { Assume that government spending is zero for this economy. }\end{array}$
-Refer to Table 10.3. What will be the value of the spending multiplier?

A) 1
B) 0.47
C) 5
D) 1.25
E) 2.13

Correct Answer:

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