Suppose GDP in this country is $680 million. Enter the amount for government purchases.
|
National Income Account |
Value |
|---|---|
|
(Millions of dollars) |
|
| Government Purchases (GG) | |
| Taxes minus Transfer Payments (TT) | 180 |
| Consumption (CC) | 300 |
| Investment (II) | 180 |
| National Saving (S) | = | Y - C - G |
| = | I | |
| Private Saving | = | Y - C - T |
| = |
| Public Saving | = | T - G |
| = |
Based on your calculations, the government is running a budget .
Answer:
1]
GDP = C + I + G
680 million = 300 million + 180 million + G
G = 680 million - 480 million
G = $ 200 million
2]
National Saving = Private Saving + Public Saving = GDP - C - G = (680 - 300 - 200) million = 180 million
3]
Private Saving = GDP - T - C = (680 - 180 - 300) million = $ 200 million
4]
Public Saving = T - G = (180 - 200) million = -20 million
5]
Since (T - G) < 0, government is running a budget deficit.
Suppose GDP in this country is $680 million. Enter the amount for government purchases. National Income...