Answered: Saving = a. disposable income minus…

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Economics

Saving = a. disposable income minus taxes b. income minus taxes c. 1 – MPC d. disposable income minus consumption

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter23: The Aggregate Expenditure Model

Section: Chapter Questions

Problem 1P

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Question

Saving =

a. disposable income minus taxes

b. income minus taxes

c. 1 – MPC

d. disposable income minus consumption

Expert Solution

Step 1

National income is the total market value of all final goods and services that are produced in an economy within a year. Savings is a leakage for the economy as it is a withdrawal of money from the income flow. There are several concepts associated with the national income such as gross domestic product, gross national product, net domestic product, personal income, disposable income, etc.

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