In the open-economy Keynesian model,it always has to be true that
A)planned savings equals planned investment.
B)planned savings is greater than planned investment.
C)planned savings is less than planned investment.
D)none of the above.

Question

Quizplus · Accepted Answer

In the open-economy Keynesian model, it is not necessary for planned savings to equal planned investment. This is because there can be net capital outflows or inflows (the difference between exports and imports), which can either add or subtract from planned investment. Therefore, neither A nor B is always true. Option C is also not always true because it depends on the specific relationship between planned savings and planned investment, which can vary based on the other factors in the model.

In the Open-Economy Keynesian Model,it Always Has to Be True