Suppose that in a closed economy GDP is equal to 20,000,consumption equal to 15,000,government purchases equal 4,000 and taxes equal 3,000.What are private saving,public saving,and national saving?
A)-2,000,1,000,and 2,000,respectively.
B)1,000,2,000,and 3,000,respectively.
C)2,000,-1,000,and 1,000,respectively.
D)2,000,1,000,and 2,000,respectively.

Question

Quizplus · Accepted Answer

Private saving is GDP - consumption - taxes = 20,000 - 15,000 - 3,000 = 2,000. Public saving is taxes - government purchases = 3,000 - 4,000 = -1,000. National saving is private saving + public saving = 2,000 - 1,000 = 1,000.

Suppose That in a Closed Economy GDP Is Equal to 20,000,consumption