Essentials of Economics (MindTap Course List)
8th Edition
ISBN: 9781337091992
Author: N. Gregory Mankiw
Publisher: Cengage Learning
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Question
Chapter 18, Problem 4QR
To determine
The Investment and its relation to National savings in a closed economy.
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how do you solve national saving
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explaining what is a closed economy.
Briefly explain what a change in any part of the national saving and investment identity points out.
Chapter 18 Solutions
Essentials of Economics (MindTap Course List)
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Similar questions
- Why does most countries have different investment priorities?arrow_forwardIn an open economy, it is impossible to have national saving equal to domestic investment.Answer true, false, or uncertain. Please briefly explain your answer.arrow_forwardHow will you differentiate an open economy from a closed economy? Explain with the help of an example.arrow_forward
- Explain why, in a small open economy, national saving can be less than investment. Use a savings-investment graph to explainarrow_forwardEconomics Consider the following data for country B, an open economy, for this year: Y = $14 trillion C = $6 trillion G = $2 trillion NX = $3 trillion T = $4 trillion TR = $0.5 trillion a) Find country B’s domestic investment. b) Find country B’s private saving. c) Find country B’s public saving. d) Find country A’s national saving. e) Find country B’s net foreign investmentarrow_forwardDistinguish between saving and investment.arrow_forward
- “The result of the war that happened in Country A, it made Country A has negative public saving which is reduces national saving (the sum of public and private saving)”. Based on this information, explain (Show it with the graph) what happen in the market for loanable funds and the market for foreign currency exchangearrow_forwardWhat do you understand by the term “closed economy”? For a closed economy show, National savings = National Investmentarrow_forwardWhat is the saving and investment equation? If national saving declines what will happen to domestic investment and net foreign investment?arrow_forward
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