Question:
Q1. Private savings is equal to:
A Income less consumption
B Taxes less government spending on goods and services
C The total amount of savings accounts plus stocks plus bonds owned by households
D Income plus investment
Q2. The relationship between the government's budget deficit and its spending is:
A Budget deficit = tax revenues + transfer payments
B Government spending = private savings + budget deficit
C Tax revenues = national savings + budget deficit
D Budget deficit = government spending - tax revenues
Saving:
In the loanable funds market, saving is part of the supply of loanable funds. Normally, saving is directly related to interest rates. Therefore, the higher the interest rates, the higher the saving.
Answer and Explanation:1
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- Q1. Private savings is equal to A) Income less consumption.
Private saving is the saving of households in the economy. Private saving equals current...
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