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Suppose That the Economy Is in Equilibrium, with the Government

Question 63

Multiple Choice

Suppose that the economy is in equilibrium, with the government budget in surplus and with exports less than imports.According to the circular-flow model, how does saving relate to investment?  


A)  Saving must exceed investment. 
B)  Saving must be less than investment. 
C)  Saving must equal investment. 
D)  Saving could be greater than or equal to investment.

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