Use the Following to Answer Questions

question 361

Multiple Choice

Use the following to answer questions:
Scenario: Closed Economy S = I
GDP is $12 trillion this year in a closed economy. Consumption is $8 trillion and government spending is $2 trillion. Taxes are $0.5 trillion.
-(Scenario: Closed Economy S = I) Look at the scenario Closed Economy S = I. How much is private saving?

• A)$4 trillion
• B)$2.5 trillion
• C)$3.5 trillion
• D)-$0.5 trillion

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Definitions:

Microeconomics

The study of how households and firms make decisions and how they interact in markets.

Macroeconomics

The branch of economics that studies the behavior and performance of an economy as a whole, including topics such as growth, inflation, and unemployment.

GDP

Gross Domestic Product; a measure of the economic output of a country, representing the total value of all goods and services produced over a specified time period.

GDP

Gross Domestic Product is the aggregate market value of all ultimate goods and services made within a nation over a specified period.