Given National Income (Y) as: Y = C + I + G + (X - M) where C = €2,500m I = €500m G = €600m X = €300m M = €200m (i) State what each of the letters in the formula above represents. (ii) Calculate, using the figures provided, the level of National Income. (Show your workings in your answer book.)

Leaving Cert Economics Formulas: Given National Income (Y) as: Y

Given National Income (Y) as: Y = C + I + G + (X - M) where C = €2,500m I = €500m G = €600m X = €300m M = €200m (i) State what each of the letters in the formula above represents - Leaving Cert Economics - Question 6 - 2018

Question 6

Given-National-Income-(Y)-as:--Y-=-C-+-I-+-G-+-(X---M)--where-C-=-€2,500m--I-=-€500m--G-=-€600m--X-=-€300m--M-=-€200m-(i)-State-what-each-of-the-letters-in-the-formula-above-represents-Leaving Cert Economics-Question 6-2018.png

Given National Income (Y) as: Y = C + I + G + (X - M) where C = €2,500m I = €500m G = €600m X = €300m M = €200m (i) State what each of the letters in the formu... show full transcript

Worked Solution & Example Answer:Given National Income (Y) as: Y = C + I + G + (X - M) where C = €2,500m I = €500m G = €600m X = €300m M = €200m (i) State what each of the letters in the formula above represents - Leaving Cert Economics - Question 6 - 2018

Step 1

State what each of the letters in the formula above represents.

96%

114 rated

Answer

In the context of the formula for National Income:

C (Consumption): This refers to total private consumption expenditure by households.
I (Investment): This denotes total investment expenditure made by businesses.
G (Government Expenditure): This includes all government spending on goods and services.
X (Exports): This indicates the total value of goods and services sold to foreign countries.
M (Imports): This represents the total value of goods and services purchased from foreign countries.

Step 2

Calculate, using the figures provided, the level of National Income.

99%

104 rated

Answer

To calculate the National Income (Y), we use the provided formula:

$Y = C + I + G + (X - M)$

Substituting in the given values:

C = €2,500m
I = €500m
G = €600m
X = €300m
M = €200m

Now, substituting these into the formula:

$Y = 2,500 + 500 + 600 + (300 - 200)$

Calculating the value:

Calculate exports minus imports: $X - M = 300 - 200 = 100$
Now substitute back into the equation: $Y = 2,500 + 500 + 600 + 100$
Performing the addition: $Y = 3,700$

Thus, the level of National Income is €3,700m.

Given National Income (Y) as: Y = C + I + G + (X - M) where C = €2,500m I = €500m G = €600m X = €300m M = €200m (i) State what each of the letters in the formula above represents - Leaving Cert Economics - Question 6 - 2018

Worked Solution & Example Answer:Given National Income (Y) as: Y = C + I + G + (X - M) where C = €2,500m I = €500m G = €600m X = €300m M = €200m (i) State what each of the letters in the formula above represents - Leaving Cert Economics - Question 6 - 2018

State what each of the letters in the formula above represents.

Calculate, using the figures provided, the level of National Income.

Join the Leaving Cert students using SimpleStudy...