Which of the Following Must Be True

question 15

Multiple Choice

Which of the following must be true?

• A)​Savings must equal investment in an open economy.
• B)​Savings must equal investment in a closed economy.
• C)​Savings must equal consumption in an open economy.
• D)​Savings must equal consumption in a closed economy.

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Definitions:

AMT

Alternative Minimum Tax, a parallel tax system designed to ensure that individuals and corporations pay at least a minimum amount of taxes.

Alternative Minimum Tax

A parallel tax system designed to ensure that individuals and corporations that benefit from certain exemptions, deductions, or credits pay at least a minimum amount of tax.

Corporation

A legal entity that is separate and distinct from its owners, capable of owning property, entering into contracts, and being sued.

AMT Income

Income calculated for the Alternative Minimum Tax, which ensures high-income earners pay a minimum amount of tax.