The equilibrium level of income in an open economy is where:
A)Savings + Investment = Imports + Exports
B)Consumption + Savings = Imports + Exports
C)Savings + Exports = Investment + Imports
D)Savings + imports = Investment + Exports

Question

Quizplus · Accepted Answer

In an open economy, the equilibrium level of income is where savings plus imports equals investment plus exports, reflecting the balance of domestic and foreign financial flows.

The Equilibrium Level of Income in an Open Economy Is