Scenario 8-2

question 410

Multiple Choice

Scenario 8-2. Assume the following information for an imaginary, closed economy.
GDP = $200,000; consumption = $120,000;
government purchases = $35,000; and taxes = $25,000.
-Refer to Scenario 8-2. For this economy, private saving is equal to

• A) $40,000.
• B) $50,000.
• C) $55,000.
• D) $60,000.

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Definitions:

Cash Inflows

The money received by a business from its various sources during a specific period, such as sales revenue, investments, and financing.

Operating Costs

The expenses associated with the day-to-day functioning of a business, including salaries, utilities, and rent.

Useful Life

The expected period over which a fixed asset is anticipated to be usable by the company.

Limousine

A luxury vehicle driven by a chauffeur, often elongated in form, used for special occasions or services.