When desired national saving equals desired national investment (in a closed economy),what market is in equilibrium?
A)The goods market
B)The money market
C)The foreign exchange market
D)The stock market

Question

Quizplus · Accepted Answer

When desired national saving equals desired national investment, there is no excess supply or demand of goods or services, which implies that the goods market is in equilibrium. In contrast, the money market may still face excess supply or demand of money, the foreign exchange market may still experience imbalances in currency flows, and the stock market may still exhibit fluctuations in asset prices that are unrelated to saving and investment decisions at the national level.

When Desired National Saving Equals Desired National Investment (In a Closed