In the Simple Keynesian Model, If People Earn $4 Billion

question 59

True/False

In the simple Keynesian model, if people earn $4 billion and spend $3.5 billion on consumption goods, then savings is $0.5 billion.

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Definitions:

Sale

The exchange of a good or service for money; a transaction between two parties where the buyer acquires ownership of the item.

Interest Revenue

Income earned from lending money or other types of investments that yield interest.

Investment In Bonds

The purchase of bonds issued by corporations, governments, or other entities as a means of earning interest income and potential price appreciation.

Comprehensive Income

All changes in stockholders’ equity during a period, except those resulting from dividends and stockholders’ investments.