Question

The economy of Ogdenville can be characterized by the following agents:

Consumers, C = 350 + 0.8(Y-T)

Output, Y = 3000

Government expenditures, G = 600

Taxation, T = 500

Investors, I = 750-125r

Markets are fully competitive and the equilibrium condition for markets are:

Goods and service market: Y =C + I + G

Financial market: I = s

1. [3 points] Find the private, public and national saving rate

I find some people answer this question as Sprivate=Y-T-C=150, BUT someone writes Sprivate/Y=(150/3000)*100=5%

I think the second one should be correct, but from my professor's note, she wrote the answer as the first one. So, I feel so confused, I do not know which answer is correct:(  PLEASE HELP ME!!!!

Answer 1