posted by Nicole .
C = 500 + 0.80(Y – 400)
I = 400
G = 400
(X – M) = -100
Solve for income or GDP
GDP = C + I + G + (X - M)
C = household consumption expenditures / personal consumption expenditures
I = gross private domestic investment
G = government consumption and gross investment expenditures
X = gross exports of goods and services
M = gross imports of goods and services
Note: (X - M) is often written as XN, which stands for "net exports"