Answer to Question #63109 in Macroeconomics for Awais
Gross Investment $40
Govt. purchases of goods & service 30
X – M - 20
Personal Tax 60
Govt. transfer 25
Interest payments from the Govt.
to domestic Pvt. Sector 15
Factor income received from the rest of the would 7
Factor payment made to rest of would 9
a. Consumption b) GDP c) Net factor payment from abroad
b. Pvt. Saving e) Public Saving.
b. GDP = C + I + G + (X - M) = 160 + 40 + 30 – 20 = $210
c. Net factor payment from abroad (NFIA) = Factor income received from the rest of the world – Factor payment made to rest of world = 7-9 = - $2
d. Pvt. Saving = GDP – Personal Tax – Consumption = 210 – 60 – 160 = -$10
e. Public Saving = Personal Tax - Govt. purchases of goods & service = 60-30 = $30
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