Essentials of Economics (MindTap Course List)
8th Edition
ISBN: 9781337091992
Author: N. Gregory Mankiw
Publisher: Cengage Learning
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Chapter 18, Problem 3CQQ
To determine
The Private savings of the economy.
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If national saving equals $100,000, net taxes equal $100,000 and government expenditure equals $25,000, what is private saving?
Select one:
a.zero
b.$175,000
c.$25,000
d.-$25,000
e.$225,000
A closed economy has income of $1000, government spending of $200, taxes of $150, and investment of $250. What is private saving?
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Chapter 18 Solutions
Essentials of Economics (MindTap Course List)
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- GDP $7.3 trillion Consumer Spending $5.2 trillion Taxes Minus Transfers $1.1 trillion Government Purchases $0.7 trillion #39 The quantity of private saving is a $6.2 trillion. b $2.1 trillion. c $1 trillion. d $1.4 trillion.arrow_forward1. Explain the difference between public & private saving. 2. Compare & contrast stocks & bonds. 3. Graph the market for loanable funds such that current national saving is at a level of $500 million and the real interest rate is at 2.5%arrow_forward(A) Suppose that in a closed economy GDP is equal to 15,000, taxes are equal to 2,000, Consumption equals 9,000, and government expenditures equal 4,000. What are private saving and public saving? a. 4000 and –2000 b. 4000 and 2000 c. 2000 and –2000 d. 2000 and 3000 (B) A lower interest rate induces people to a. save less, so the demand for loanable funds slopes upward. b. save less, so the demand for loanable funds slopes downward. c. invest more, so the demand for loanable funds slopes upward. d. invest more, so the demand for loanable funds slopes downward. (C) Alex puts $300 into an account when the interest rate is 5 percent. Later he checks his balance and finds he has about $330,75. How long did Alex wait to check his balance? a. 2 b. 2.5 c. 3 d. 4.5arrow_forward
- If disposable personal income is $400 billion and personal saving is $8 billion, the personal saving rate is Select one: a. 12%. b. 5%. C. 1.5%. d. 2%.arrow_forwardGDP is $5 billion this year in a closed economy. Consumption is $3 billion, and government spending is $0.5 billion and taxes are $0.5 billion. How much is private saving? Select one: Oo $4.5 billion Ob 50 billions OC -50.5 billion Od $1.5 billion.arrow_forwardProblem 1: Identify each of the following acts as representing either saving or investment. a. Lan uses some of his income to buy government bonds. b. Minh takes some of his income and buys mutual funds. c. Linh purchases a new truck for his delivery business using borrowed funds. d. Peter uses some of his income to buy stock in a major corporation, e. Dave hires a builder to construct a new home using borrowed funds.arrow_forward
- both I 9. High interest rates might rates might saving. a. discourage; encourage b. discourage; discourage C. encourage; encourage d. encourage; discourage purchasing a house or car but at the same time high interestarrow_forwardThe most likely effect of an increase in the supply of loanabke funds is which of the following? I. Increase Interest Rates. II. Decrease Interest Rates. III. Increase Investment. IV. Decrease Investment. a. I only. b. II only. c. III only. d. I and IV only. e. II and III only.arrow_forward6. In macroeconomist mind, Explain how they are able to distinguish the terms between investment and saving. Then explain this condition either entering investment or saving and explain why you choose it. a. When your family takes out a loan from the banks and buys a new house. b. When you use your $250 paycheck to buy stock in UNILEVER. c. When your friend earns $50 and deposits it in his account at the bank. d. When you borrow $2,000 from a bank to buy a car to use in your business.arrow_forward
- Which of the following situations represents investment? Saving? ExplainYour family takes out a mortgage and buys a new house. You use your paycheque to buy stock in Sagicor Financial Services.arrow_forwardIf Congress instituted an investment tax credit, the interest rate would Select one: a.rise and saving would rise. b.fall and saving would fall. c.fall and saving would rise. d.rise and saving would fall.arrow_forwardThe demand for loanable funds has a ________ slope because the lower the interest rate, the ________ number of investment projects are profitable, and the ________ the quantity of loanable funds demanded. A. negative; lesser; greater B. positive; lesser; lesser C. negative; greater; greater D. positive; greater; greater E. negative; greater; lesser QUESTION 14 The statement "This Dell laptop costs $1,200" illustrates which function of money? A. Liquidity. B. Medium of exchange. C. Standard of deferred payment. D. Store of value. E. Unit of account.arrow_forward
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