The notation is Y = GNP = national income C = consumption 1 = private investment G = government spending X = exports M = imports T = taxes S = savings There is an intimate relationship between a country's BCA and how the country finances its domestic investment and pays for government expenditures. This relationship is given by BCA = X- M = (S-1) + (TG). Given this, in order for a country to reduce a BCA deficit, which of the following
The notation is Y = GNP = national income C = consumption 1 = private investment G = government spending X = exports M = imports T = taxes S = savings There is an intimate relationship between a country's BCA and how the country finances its domestic investment and pays for government expenditures. This relationship is given by BCA = X- M = (S-1) + (TG). Given this, in order for a country to reduce a BCA deficit, which of the following
Chapter1: Making Economics Decisions
Section: Chapter Questions
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![The notation is
Y = GNP = national income
C = consumption
1 = private investment
G = government spending
X = exports
M = imports
T = taxes
S = savings
There is an intimate relationship between a country's BCA and how the country finances its
domestic investment and pays for government expenditures. This relationship is given by BCA = X -
M = (SI) + (TG). Given this, in order for a country to reduce a BCA deficit, which of the following
must occur?](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F7ae1a2ac-c355-4e8e-acd0-18dbc1feffb4%2F3b66cc12-cef1-4218-9de4-22b4fdd6892d%2F4snxir_processed.png&w=3840&q=75)
Transcribed Image Text:The notation is
Y = GNP = national income
C = consumption
1 = private investment
G = government spending
X = exports
M = imports
T = taxes
S = savings
There is an intimate relationship between a country's BCA and how the country finances its
domestic investment and pays for government expenditures. This relationship is given by BCA = X -
M = (SI) + (TG). Given this, in order for a country to reduce a BCA deficit, which of the following
must occur?
![Multiple Choice
O
O
For a given level of S and I, the government budget deficit (T - G) must be
reduced.
For a given level of I and (TG), S must be increased.
For a given level of S and (TG), I must fall.
All of the options would work to reduce a BCA deficit.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F7ae1a2ac-c355-4e8e-acd0-18dbc1feffb4%2F3b66cc12-cef1-4218-9de4-22b4fdd6892d%2Farh5p7n_processed.png&w=3840&q=75)
Transcribed Image Text:Multiple Choice
O
O
For a given level of S and I, the government budget deficit (T - G) must be
reduced.
For a given level of I and (TG), S must be increased.
For a given level of S and (TG), I must fall.
All of the options would work to reduce a BCA deficit.
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