Which of the following statements is INCORRECT?
A) Net exports equals exports minus imports.
B) The government sector balance equals net taxes minus government expenditures on goods and services.
C) The private sector balance equals private investment minus private saving.
D) The sum of the government sector balance and the private sector balance equals net exports.

Question

Quizplus · Accepted Answer

The private sector balance is correctly defined as private saving minus private investment, not the other way around. This balance indicates the net savings of the private sector after accounting for its investment spending.

Which of the Following Statements Is INCORRECT