Principles of Macroeconomics, Loose-Leaf Version
8th Edition
ISBN: 9781337096881
Author: Mankiw, N. Gregory
Publisher: South-Western College Pub
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Chapter 13, Problem 4QR
To determine
The Investment and its relation to National savings in a closed economy.
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Chapter 13 Solutions
Principles of Macroeconomics, Loose-Leaf Version
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- What is Foreign Direct Investment (FDI) all about?arrow_forwardIn an open economy, gross domestic product equals $2,450 billion, consumption expenditure equals $1,390 billion, government expenditure equals $325 billion, investment equals $510 billion, and net capital outflow equals $225 billion. What is national saving?arrow_forwardDifferentiate between a closed economy and an open economyarrow_forward
- Explain why, in a small open economy, national saving can be less than investment. Use a savings-investment graph to explainarrow_forwardIn an open economy, it is impossible to have national saving equal to domestic investment.Answer true, false, or uncertain. Please briefly explain your answer.arrow_forwardEconomics Consider the following data for country B, an open economy, for this year: Y = $14 trillion C = $6 trillion G = $2 trillion NX = $3 trillion T = $4 trillion TR = $0.5 trillion a) Find country B’s domestic investment. b) Find country B’s private saving. c) Find country B’s public saving. d) Find country A’s national saving. e) Find country B’s net foreign investmentarrow_forward
- Last year a country purchased $1.5 trillion worth of goods and services from foreign countries, sold $2 trillion worth of goods and services to foreign countries and had national saving of $1.15 trillion. What was the value of its domestic investment?arrow_forwardIn an open economy, gross domestic product equals $2,460 billion, consumption expenditure equals $1,435 billion, government expenditure equals $325 billion, investment equals $560 billion, and net capital outflow equals $375 billion. What is national saving? $1,260 billion $2,135 billion $935 billion $1,900 billionarrow_forwardChange in the financial market of an economy will affect the global economy. Briefly discuss.arrow_forward
- True or false? Low saving impedes growth in capital, productivity, and living standards for a closed economy, but not for an open economy. You'd better explain your answer by graph. (Hint: Consider elasticity of demand/supply in loanable fund market.)arrow_forwardWhat is the saving and investment equation? If national saving declines what will happen to domestic investment and net foreign investment?arrow_forwardWhat do you understand by the term “closed economy”? For a closed economy show, National savings = National Investmentarrow_forward
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