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Supposed that in a closed economy GDP is equal to 11,000, taxes are equal to 1,500, consumption equals 7,500 and government purchases equal 2,000. What is national saving

Answer :

Answer: National Saving = 1500

Explanation:

Given that,

Y (Income) = GDP =  11,000

Taxes = 1500

Consumption = 7500

Government Purchases = 2000

National saving is the sum of two components that are public savings and private savings.

National Saving = GDP - Consumption - Government Purchases

= 11000 - 7500 - 2000

= 1500

∴ The national saving in a closed economy is 1500.

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