Which of the Following Equations Is a Correct Expression for National

question 24

Multiple Choice

Which of the following equations is a correct expression for national saving in the long run when real GDP equals potential output?

• A)NS = Y* - C - G
• B)NS = Y* - C + T - G
• C)NS = Y* - T - C
• D)NS = T - G
• E)NS = T - G - C

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Definitions:

Initial Outlay

The initial investment amount or initial cost incurred in starting a project, purchasing an asset, or initiating an investment.

Incremental Cash Flows

The additional cash flow generated by a company from undertaking a particular project or investment.

New Venture

Refers to a newly established business entity created with the intention of entering a market.

Opportunity Cost

The financial loss involved in not selecting the subsequent top preference during the decision-making process.