Suppose that in a closed economy GDP is equal to 11,000,taxes are equal to 3500,consumption is equal to 6500,and government expenditures are equal to 2000.What is private saving?
A) 0
B) 500
C) 1000
D) 1500

Question

Quizplus · Accepted Answer

Private saving is calculated as the difference between disposable income (GDP minus taxes) and consumption. Therefore, private saving = (11,000 - 3,500) - 6,500 = 1,000. The correct answer is therefore choice C, 1000.

Suppose That in a Closed Economy GDP Is Equal to 11,000,taxes