Where Y is GDP, C is consumption, I is investment, T is net taxes and G is government spending, if there is no trade, then private saving equals:Group of answer choicesY - T - CY - C – IY - T – GC + I + G – T
Question
Where Y is GDP, C is consumption, I is investment, T is net taxes and G is government spending, if there is no trade, then private saving equals:Group of answer choicesY - T - CY - C – IY - T – GC + I + G – T
Solution
The formula for private saving when there is no trade is Y - T - C.
Here's the step by step explanation:
-
Gross Domestic Product (Y) is the sum of Consumption (C), Investment (I), and Government Spending (G). Since there is no trade, we don't consider exports and imports. So, Y = C + I + G.
-
Net taxes (T) is the amount the government collects from the economy.
-
Private saving is what's left of the GDP after we subtract what's consumed (C) and what's paid as net taxes (T).
So, Private Saving = Y - T - C.
Similar Questions
Consider a closed economy. Household saving is $300, business saving is $700, government purchases are $1000, government transfers and interest payments are $500, government tax collections are $1300, and GDP is $5000. What is national saving?Group of answer choices$1000$500$800$0
In a closed economy, private saving, , is equal toA) I - (G - T).B) I + (G - T).C) I + (G + T).D) I - (G + T).E) I + (G - T) + C.
For a closed economy, GDP is $29 trillion, consumption is $9 trillion, taxes are $2.0 trillion and the government runs a surplus of $4 trillion. What are private saving and national saving?Group of answer choices$18.0 trillion and $22.0 trillion, respectively$22.0 trillion and $18.0 trillion, respectively−$18.0 trillion and −$22.0 trillion, respectively−$18.0 trillion and $22.0 trillion, respectively
Select Any One Of the Following Options: The GDP of a small country: $ 100 billion. Gross Private investment: $30 billion. Consumption expenditure: $60 billion and Net export: (minus) $ 10 billion. What would be the value of G?$30 billion$ 20 billion0$ 10 billion
If government purchases equal $100 million, consumption is $200 million, net exports are $0, and investment is $50 million, what are the national savings?$ million
Upgrade your grade with Knowee
Get personalized homework help. Review tough concepts in more detail, or go deeper into your topic by exploring other relevant questions.