(Table) When You Look at "Table: GDP Data for Two

question 281

Multiple Choice

(Table) When you look at "Table: GDP Data for Two Countries," what evidence do you see that suggests which country has the highest savings rate? $$\begin{array} { | c | c | c | c | c | c | c | } \hline \text { Country } & \text { GDP } & \text { Population } & \text { C } & \text { I } & \text { G } & \text { X-M } \\\hline \text { Econia } & \$ 90 \text { billion } & 30 \text { million } & \text { \$55 billion } & \$ 3 \text { billion } & \$ 30 \text { billion } & \$ 2 \text { billion } \\\hline \text { Macland } & \$ 200 \text { billion } & 50 \text { million } & \$ 100 \text { billion } & \$ 30 \text { billion } & \$ 50 \text { billion } & \$ 20 \text { billion } \\\hline\end{array}$$

• A) The smaller amount of consumer spending in Econia suggests that it has a higher savings rate.
• B) Consumer spending is a smaller share of total spending in Macland, suggesting that consumers are saving a larger share of their income.
• C) Investment is lower in Econia, suggesting the households are saving rather than investing.
• D) The higher GDP in Macland means that they must have a higher savings rate.

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Definitions:

Flood Basalts

Vast areas covered by large volumes of basalt lava, which erupt during major volcanic episodes.

Siberia

A vast geographic region, covering most of North Asia, known for its harsh climate, extensive boreal forests, and significant mineral resources.

Ocean Plateaus

Large, elevated areas on the ocean floor, generally volcanic in origin, rising several hundred meters above the surrounding seafloor.

Basalt Magma

A type of magma that is low in silica and typically originates from the upper mantle, leading to the formation of basalt rock upon cooling.