Subpart (a): Explanation The savings is the revenue left after the spending. There are mainly three types of incomes and they are the private income, government income and national income . The personal income refers to the income of the individual or the consumer. When the personal income tax is paid out of the income of the individual, the remaining part is known as the private savings. The government savings is the savings left with the government after the different spending of the government. The income of the government is the tax revenue collected by the government. The spending of the government includes different spending of the public programs. The remaining portion of the government income after the spending is known as the government savings. The national saving on the other hand is the summation of the private savings and the government savings. Investment is an asset or an item purchased today in the hope that it will generate income in the future. In that sense, the spending of capital on the purchase of new physical capitals refers to the equipment and the buildings and so forth... Subpart (b): To determine The difficulties in increasing the investment of the economy.

The difficulties in increasing the investment of the economy.

EBK ESSENTIALS OF ECONOMICS

7th Edition

ISBN: 8220102452107

Author: Mankiw

Publisher: CENGAGE L

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Question

Chapter 18, Problem 9PA

Subpart (a):

To determine