Problem
1. What does the IS curve show? Why does it slope downward?
2. What causes the IS curve to shift?
3. The Bureau of Economic Analysis valued nominal U.S. gross domestic product (i.e., actual expenditure) at $14,460 billion at the end of 2009. Suppose that the consumption expenditure was $10,250 billion, planned investment spending was $1,680 billion, and government spending was $2,970 billion.
a) Assuming the goods market is in equilibrium, calculate spending in net exports.
b) If U.S. imports are valued at $2,100 billion, calculate spending on U.S. exports.
The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.