If national saving (S) is $100,000, net taxes (T) equal $100,000 and government expenditure (G) is $25,000, how much are households and businesses saving?
A) $25,000
B) $225,000
C) -$25,000
D) none of the above

Question

Quizplus · Accepted Answer

Households and businesses saving is calculated as national saving minus government saving. Government saving is T - G = $100,000 - $25,000 = $75,000. Therefore, households and businesses saving is $100,000 - $75,000 = $25,000.

If National Saving (S) Is $100,000, Net Taxes (T) Equal