8) government budget surplus from reduced government spending will ________ thelevel of investment in the economy and ________ the level of public saving in theeconomy.A) increase; decreaseB) increase; increaseC) decrease; increaseD) decrease; decrease 9) Starting at point B in the diagram below, identify which combinations of points illustratepositive technological change.Real GDPper hourworked, Y/L$17,00016,40016,00015,000A) Movement from B to C.B) Movement from B to D.C) Movement from B to A.D) Movement from B to E.$50,000B60,00070,000Productionfunction3Productionfunction2Productionfunction1Capital per hourworked, K/L

***Since the student has posted multiple questions, hence, the expert is required to solve only the…

8) government budget surplus from reduced government spending will ________ the level of investment in the economy and ________ the level of public saving in the economy. A) increase; decrease B) increase; increase C) decrease; increase D) decrease; decrease

8) government budget surplus from reduced government spending will the level of investment in the economy and the level of public saving in the economy. A) increase; decrease B) increase; increase C) decrease; increase D) decrease; decrease

Principles of Microeconomics

7th Edition

ISBN:9781305156050

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter2: Thinking Like An Economist

Section: Chapter Questions

Problem 1PA

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Concept explainers

Public Saving

Public saving deals with the amount which has been in excess after meeting all the obligatory expenses and investment of the government. Taxes are collected by the government to meet its day-to-day expenditures. The obligatory expenses include all those expenses which are mandatory for the government. It cannot be avoided as it is inevitable.

Question

8) government budget surplus from reduced government spending will ________ the
level of investment in the economy and ________ the level of public saving in the
economy.
A) increase; decrease
B) increase; increase

C) decrease; increase
D) decrease; decrease

9) Starting at point B in the diagram below, identify which combinations of points illustrate
positive technological change.
Real GDP
per hour
worked, Y/L
$17,000
16,400
16,000
15,000
A) Movement from B to C.
B) Movement from B to D.
C) Movement from B to A.
D) Movement from B to E.
$50,000
B
60,000
70,000
Production
function3
Production
function2
Production
function1
Capital per hour
worked, K/L

Definition Definition Income earned by a government that is not spent on current expenses, but rather saved for future investments or to pay off debts. It is the difference between government revenue and expenditures, and can be positive or negative.

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