Define the two categories of saving in the economy
What will be an ideal response?
There are two categories of saving in the economy: private saving by households and public saving by the government. Private saving is what is left of income after consumption expenditures and income taxes. Public saving is the amount of tax revenue that the government collects minus government expenditures and transfer payments.
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Which of the following backs our money supply?
a. The words "This note is legal tender." b. The faith in the government c. The faith that people will take it in exchange for goods and services d. Precious metals
Strategic trade policy considerations imply that free trade policies should never be pursued
Indicate whether the statement is true or false
As interest rates increase, the quantity of loanable funds that are supplied to the loanable funds market
a. increases because people will be attracted by the higher rate of interest b. decreases because businesses borrow less c. increases because businesses borrow less d. decreases because people save less e. decreases because people will be attracted by the higher rate of interest
The exchange rate states the price, in terms of one currency, at which another currency can be bought
a. True b. False Indicate whether the statement is true or false