Question 1

If national saving in a closed economy is greater than zero,which of the following must be true?

Accepted Answer

A)  Either public saving or private saving must be greater than zero.
B)  Investment is positive.
C)   
D)  All of the above are correct.E) A) and D)
F) A) and C) D

Question 2

In examining the national income accounts of the closed economy of Nepotocracy you see that this year it had taxes of $100 billion,transfers of $20 billion,and government purchases of goods and services of $70 billion.You also notice that last year it had private saving of $70 billion and investment of $50 billion.In which year did Nepotocracy have a budget deficit of $20 billion?

Accepted Answer

A)  this year and last year
B)  this year but not last year
C)  last year but not this year
D)  neither this year nor last yearE) B) and C)
F) A) and B)

Question 3

In a closed economy,public saving is the amount of

Accepted Answer

A)  income that households have left after paying for taxes and consumption.
B)  income that businesses have left after paying for the factors of production.
C)  tax revenue that the government has left after paying for its spending.
D)  spending that the government undertakes in excess of the taxes it collects.E) A) and B)
F) None of the above

Question 4

According to the definitions of national saving and public saving,if Y,C,and G remained the same,an increase in taxes would

Accepted Answer

A)  raise national saving and public saving.
B)  raise national saving and raise public saving.
C)  leave national saving and public saving unchanged.
D)  leave national saving unchanged and raise public saving.E) A) and B)
F) None of the above

Question 5

Consider three different closed economies with the following national income statistics.Country A has taxes of $40 billion,transfers of $20 billion,and government expenditures on goods and services of $30 billion.County B has private savings of $60 billion,and investment expenditures of $40 billion.Country C has GDP of $300 billion,investment of $90,consumption of $180 billion,taxes of $60 billion and transfers of $20 billion.From this information,we know that

Accepted Answer

A)  country A has the largest government budget deficit.
B)  country B has the largest government budget deficit.
C)  country C has the largest government budget deficit.
D)  The government budget deficit is equal in all three countries.E) B) and D)
F) B) and C)

Question 6

In a small closed economy investment is $50 billion and private saving is $45 billion.What are public saving and national saving?

Accepted Answer

A)  $5 billion and $45 billion
B)  -$5 billion and $45 billion
C)  $5 billion and $50 billion
D)  -$5 billion and $50 billionE) B) and C)
F) None of the above

Question 7

Scenario 26-1.Assume the following information for an imaginary,closed economy.
GDP = $100,000;taxes = $22,000;government purchases = $25,000;national
saving = $15,000.
-Refer to Scenario 26-1.For this economy,consumption amounts to

Accepted Answer

A)  $68,000.
B)  $38,000.
C)  $53,000.
D)  $60,000.E) A) and C)
F) C) and D)

Question 8

In a closed economy,what remains after paying for consumption and government purchases is

Accepted Answer

A)  national disposable income.
B)  national saving.
C)  public saving.
D)  private saving.E) A) and B)
F) A) and C)

Question 9

Suppose the economy is closed and consumption is 8 million,taxes are 2 million,and government purchases are 1.75 million.If national saving amounts to 1.25 million,then what is GDP?

Accepted Answer

A)  9 million.
B)  9.5 million.
C)  13 million.
D)  11 million.E) All of the above
F) A) and C)

Question 10

Which of the following lists correctly identifies the four expenditure categories of GDP?

Accepted Answer

A)  consumption,government purchases,investment,net-exports
B)  consumption,investment,depreciation,net-exports
C)  consumption,saving,investment,depreciation,
D)  consumption,government purchases,investment,savingsE) B) and C)
F) A) and D)

Question 11

In national income accounting,we use which of the following pairs of terms interchangeably?

Accepted Answer

A)  "investment" and "private saving"
B)  "investment" and "purchases of stocks and bonds"
C)  "saving" and "national saving"
D)  "public saving" and "government tax revenue minus government spending"E) B) and C)
F) A) and B)

Question 12

Melinda buys new equipment for her dental office with funds she borrowed from a bank that raised funds from depositors.Which of the following is correct?

Accepted Answer

A)  Melinda is an investor.
B)  The depositors are investors.
C)  Both Melinda and the depositors are investors.
D)  Neither Melinda nor the depositors are investors.E) A) and D)
F) All of the above A

Question 13

The identity that shows that total income and total expenditure are equal is

Accepted Answer

A)  GDP = Y.
B)  Y = DI + T + NX.
C)  GDP = GNP - NX.
D)  Y = C + I + G + NX.E) A) and C)
F) B) and D)

Question 14

Which of the following expressions must be equal to national saving for a closed economy?

Accepted Answer

A)  Y - I - G - NX
B)  Y - C - G
C)  Y - I - C
D)  G + C - YE) B) and C)
F) A) and C)

Question 15

Scenario 26-3.Assume the following information for an imaginary,open economy.
Consumption = $1,000;investment = $200;net exports = -$50;
taxes = $230;private saving = $225;and national saving = $150.
-Refer to Scenario 26-3.This economy's government is running a

Accepted Answer

A)  budget deficit of $75.
B)  budget deficit of $80.
C)  budget deficit of $50.
D)  budget deficit of $100.E) B) and D)
F) B) and C)

Question 16

Suppose private saving in a closed economy is $12b and investment is $10b.

Accepted Answer

A)  National saving must equal $12b.
B)  Public saving must equal $2b.
C)  The government budget surplus must equal $2b.
D)  The government budget deficit must equal $2b.E) A) and B)
F) C) and D)

Question 17

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

Accepted Answer

A)  -500
B)  500
C)  2,000
D)  None of the above is correct.E) C) and D)
F) B) and D)

Question 18

For an imaginary closed economy,T = $5,000;S = $11,000;C = $48,000;and the government is running a budget surplus of $1,000.Then

Accepted Answer

A)  private saving = $10,000 and GDP = $55,000.
B)  private saving = $10,000 and GDP = $63,000.
C)  private saving = $12,000 and GDP = $67,000.
D)  private saving = $12,000 and GDP = $69,000.E) C) and D)
F) A) and C) B

Question 19

Which of the following is not always correct for a closed economy?

Accepted Answer

A)  National saving equals private saving plus public saving.
B)  Net exports equal zero.
C)  Real GDP measures both income and expenditures.
D)  Private saving equals investment.E) B) and C)
F) C) and D)

Question 20

According to the definitions of national saving and private saving,if Y,C,and G remained the same,an increase in taxes would

Accepted Answer

A)  raise both national saving and private saving.
B)  raise national saving and reduce private saving.
C)  leave national saving and private saving unchanged.
D)  leave national saving unchanged and reduce private saving.E) A) and D)
F) A) and B)

Exam 13: Saving Investment and the Financial System: Saving and Investment in the National Income Accounts

If national saving in a closed economy is greater than zero,which of the following must be true?

Correct Answer
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D

Correct Answer
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In a closed economy,public saving is the amount of

Correct Answer
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According to the definitions of national saving and public saving,if Y,C,and G remained the same,an increase in taxes would

Correct Answer
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Correct Answer
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In a small closed economy investment is $50 billion and private saving is $45 billion.What are public saving and national saving?

Correct Answer
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Scenario 26-1.Assume the following information for an imaginary,closed economy. GDP = $100,000;taxes = $22,000;government purchases = $25,000;national saving = $15,000. -Refer to Scenario 26-1.For this economy,consumption amounts to

Correct Answer
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In a closed economy,what remains after paying for consumption and government purchases is

Correct Answer
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Suppose the economy is closed and consumption is 8 million,taxes are 2 million,and government purchases are 1.75 million.If national saving amounts to 1.25 million,then what is GDP?

Correct Answer
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Which of the following lists correctly identifies the four expenditure categories of GDP?

Correct Answer
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In national income accounting,we use which of the following pairs of terms interchangeably?

Correct Answer
verified

Melinda buys new equipment for her dental office with funds she borrowed from a bank that raised funds from depositors.Which of the following is correct?

Correct Answer
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A

The identity that shows that total income and total expenditure are equal is

Correct Answer
verified

Which of the following expressions must be equal to national saving for a closed economy?

Correct Answer
verified

Scenario 26-3.Assume the following information for an imaginary,open economy. Consumption = $1,000;investment = $200;net exports = -$50; taxes = $230;private saving = $225;and national saving = $150. -Refer to Scenario 26-3.This economy's government is running a

Correct Answer
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Suppose private saving in a closed economy is $12b and investment is $10b.

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

Correct Answer
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For an imaginary closed economy,T = $5,000;S = $11,000;C = $48,000;and the government is running a budget surplus of $1,000.Then

Correct Answer
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B

Which of the following is not always correct for a closed economy?

Correct Answer
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According to the definitions of national saving and private saving,if Y,C,and G remained the same,an increase in taxes would

Correct Answer
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Exam 13: Saving Investment and the Financial System: Saving and Investment in the National Income Accounts

If national saving in a closed economy is greater than zero,which of the following must be true?

Correct AnswerverifiedD

Correct AnswerverifiedShow Answer

In a closed economy,public saving is the amount of

Correct AnswerverifiedShow Answer

According to the definitions of national saving and public saving,if Y,C,and G remained the same,an increase in taxes would

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

In a small closed economy investment is $50 billion and private saving is $45 billion.What are public saving and national saving?

Correct AnswerverifiedShow Answer

Scenario 26-1.Assume the following information for an imaginary,closed economy. GDP = $100,000;taxes = $22,000;government purchases = $25,000;national saving = $15,000. -Refer to Scenario 26-1.For this economy,consumption amounts to

Correct AnswerverifiedShow Answer

In a closed economy,what remains after paying for consumption and government purchases is

Correct AnswerverifiedShow Answer

Suppose the economy is closed and consumption is 8 million,taxes are 2 million,and government purchases are 1.75 million.If national saving amounts to 1.25 million,then what is GDP?

Correct AnswerverifiedShow Answer

Which of the following lists correctly identifies the four expenditure categories of GDP?

Correct AnswerverifiedShow Answer

In national income accounting,we use which of the following pairs of terms interchangeably?

Correct AnswerverifiedShow Answer

Melinda buys new equipment for her dental office with funds she borrowed from a bank that raised funds from depositors.Which of the following is correct?

Correct AnswerverifiedA

The identity that shows that total income and total expenditure are equal is

Correct AnswerverifiedShow Answer

Which of the following expressions must be equal to national saving for a closed economy?

Correct AnswerverifiedShow Answer

Scenario 26-3.Assume the following information for an imaginary,open economy. Consumption = $1,000;investment = $200;net exports = -$50; taxes = $230;private saving = $225;and national saving = $150. -Refer to Scenario 26-3.This economy's government is running a

Correct AnswerverifiedShow Answer

Suppose private saving in a closed economy is $12b and investment is $10b.

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

For an imaginary closed economy,T = $5,000;S = $11,000;C = $48,000;and the government is running a budget surplus of $1,000.Then

Correct AnswerverifiedB

Which of the following is not always correct for a closed economy?

Correct AnswerverifiedShow Answer

According to the definitions of national saving and private saving,if Y,C,and G remained the same,an increase in taxes would

Correct AnswerverifiedShow Answer

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D

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A

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B

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