In 2008, Suppose Country a Had Net Taxes of $30

question 218

Multiple Choice

In 2008, suppose Country A had net taxes of $30 million and government expenditures of $35 million. In addition, household saving in Country A totalled $5 million while consumption was
$80 million. The government of Country A is running a budget and national saving is
Million.

• A) deficit; $5
• B) surplus; $25
• C) deficit; - $5
• D) surplus; $5

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Definitions:

Du Pont Analysis

A financial analysis method that breaks down return on equity into three parts: operating efficiency, asset use efficiency, and financial leverage, allowing for detailed evaluation of a company's performance.

ROE

Return on Equity, a measure of financial performance calculated by dividing net income by shareholders' equity, indicating how well a company uses investments to generate earnings growth.

Ratio Analysis

A quantitative analysis method used to evaluate a company's financial health by calculating ratios from financial statements.

Operating Activities

Transactions and other events that affect the net income of a business, relating to its principal revenue-producing operations.