Private disposable income and national savings

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Reference no: EM131000924

Calculating savings using the goods market equilibrium. Assume a closed economy (NX = 0).

a. Suppose net taxes are $100 billion. Government spending is $125 billion. Investment is $50 billion and consumption is $100 billion. Calculate public savings, private disposable income and national savings.

b. Suppose the budget deficit is $50 billion. National savings are $75 billion. Government spending is $100 billion. Calculate public savings, net taxes and private savings.

Reference no: EM131000924

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