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Sagot :
Answer:
a. Private saving = $3 trillion
b. Public saving = $3 trillion
c. G = Government purchases = $0
d. The government budget balance is $3 trillion and as a result the government budget is in surplus.
Explanation:
Note: This question is not complete as the data are omitted. The complete question is therefore provided before answering the question as follows:
Consider the following data for a closed economy:
Y = $12 trillion
C = $6 trillion
I = $3 trillion
TR = $1 trillion
T = $4 trillion
Use the data to calculate the following. (Enter your responses as integers.) a. Private saving: $ nothing trillion.
b. Public saving: $ nothing trillion.
c. Government purchases: $ nothing trillion.
d. The government budget balance is $ nothing trillion and as a result the government budget is in ▼ surplus balance deficit .
The explanation of the answer is now given as follows:
Note that:
Y = national income (GDP) = $12 trillion
C = consumption = $6 trillion
I = investment = $3 trillion
TR = Transfers paid by the government to the consumers = $1 trillion
T = Taxes paid by consumers = $4 trillion
a. Private saving: $ nothing trillion.
Private saving = Y − T + TR − C = $12 trillion - $4 trillion + $1 trillion - $6 trillion = $3 trillion
b. Public saving: $ nothing trillion.
Let G = Government purchases
Therefore, we have:
Public saving = T − G − TR = $4 trillion - $0 - $1 trillion = $3 trillion
c. Government purchases: $ nothing trillion.
National saving = Private saving + Public saving = $3 trillion + $3 trillion = $6 trillion
The Government purchases (G) can therefore be derived using the following equation:
National saving = Y - C - G ................. (1)
Substituting the relevant values into equation (1) and solve for G, we have:
$6 trillion = $12 trillion - $6 trillion - G
G = $12 trillion - $6 trillion - $6 trillion
G = $0
d. The government budget balance is $ nothing trillion and as a result the government budget is in ▼ surplus balance deficit .
In economics, Public saving is also know as Budget surplus. Therefore, we have:
Public saving = Budget surplus = $3 trillion
Therefore, the government budget balance is $3 trillion and as a result the government budget is in surplus.
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