Suppose a Closed Economy Had Public Saving of $2 Trillion

question 374

Multiple Choice

Suppose a closed economy had public saving of $2 trillion and private saving of $4 trillion. What are national saving and investment for this country?

• A)$6 trillion, $6 trillion
• B)$6 trillion, $2 trillion
• C)$1 trillion, $4 trillion
• D)$2 trillion, $2 trillion

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Definitions:

Net Advantage

The benefit or gain that results from a specific course of action, minus any associated costs.

Resale Value

The estimated value for which an asset can be sold in the marketplace after some period of use.

Depreciation Tax Shield

A reduction in taxable income for firms, achieved through claiming depreciation expenses, thereby lowering the tax liability.

Corporate Tax Rate

The percentage of a corporation's taxable income that is paid as tax to the government, varying by country and sometimes within regions of a country.