A closed economy does not engage in international trade,therefore A)national saving is less than investment (S I. D)national saving is zero.

Question

A closed economy does not engage in international trade,therefore
A)national saving is less than investment (S < I).
B)net exports (NX)are zero.
C)Y - C - G > I.
D)national saving is zero.

Quizplus · Accepted Answer

In a closed economy, net exports are zero because there is no international trade. Therefore, there are no imports or exports to affect the balance of trade, and the value of exports is equal to the value of imports. The other options (A, C, and D) are not necessarily true for a closed economy and may depend on factors such as the level of investment, government spending, and national saving.

A Closed Economy Does Not Engage in International Trade,therefore