1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Alex777 [14]
3 years ago
5

In a closed economy, saving and investment must be equal, but this is not the case in an open economy. In the following problem,

you will explore how saving and investment are connected to the international flow of capital and goods in an economy. Before delving into the relationship between these various components of an economy, you will be asked to recall some relationships between aggregate variables that will be useful in your analysis.
Recall the components that make up GDP. National income (Y) equals total expenditure on the economy's output of goods and services. Thus, where C = consumption, I = investment, G = government purchases, X = exports, M = imports, and NX = net exports:
Y =____.
Also, national saving is the income of the nation that is left after paying for____. Therefore, national saving (S) is defined as:
S =____.
Re-arranging the previous equation and solving for Y yields Y =_____. Plugging this into the original equation showing the various components of GDP results in the following relationship:
S =_____.
This is equivalent to S =____, since net exports must equal net capital outflow (NCO, also known as net foreign investment).
Now suppose that a country is experiencing a trade surplus. Determine the relationships between the entries in the following table, and enter these relationships using the following symbols: > (greater than), < (less than), or = (equal to).
Outcomes of a Trade Surplus
Imports Exports
Net Exports 0
Y C+/+G
Saving Investment
0 Net Capital Outflow
Business
1 answer:
Lilit [14]3 years ago
6 0

Answer:

S>I

Explanation:

Y = C + I + G + (X - M) \\Y = C + I + G + NX

National saving is the income of the nation left after paying for government purchases and consumption. So,

S = Y - C - G

Y = C + S + G \\

Plugging this back into the equation for GDP, we get

Y = C + I + G + NX \\C + S + G = C + I + G + NX \\S = I + NX \\S = I + NX\\S = I + NCO

where, NCO is Net capital outflow.

When there is balanced trade, we have

X = M \\i.e \\NX = 0 \\So, S = I

When there is trade surplus, we have

X>M \\NX > 0 \\NCO > 0 \\Y > C + I + G

Thus,

S > I

You might be interested in
Management is needed in all types and sizes of organizations, at all organizational levels and in all organizational work areas,
Murrr4er [49]

Answer:

Universality of management

Explanation:

As the name suggest the management is universal that means the same technique, same procedure, policies, rules, regulations, etc are applicable in all level of the organizations i.e top, middle and lower level of management plus it also applies on the various size of the organizations and the working locations so that the efficiency and effectiveness of the task or work could be done in a smooth manner

5 0
3 years ago
Big Equipment Company sold a tractor-scraper to Ace Paving for $125,000. Ace made a down payment of $25,000 and agreed to pay th
miv72 [106K]

Answer:

a. Reformation

Explanation:

In the given instance, it is clearly observed that the Vehicle Identification Number is not correctly written in the contract, and that happened due to typing errors, and was not intentional.

In these cases the courts order to reform the contract, and then the reformed contract shall reflect the intentions of both the parties as what they intend.

In the given case also, reformation will take place as the error is not due to intentionally, fraud with the other party. Thus correct option is:

a. Reformation

7 0
3 years ago
The relationship between quantity supplied and price is _____
Nataliya [291]

Answer:

I believe it is profit

Explanation:

6 0
3 years ago
How to make a business tycoon by yourself?
Mila [183]

Answer:

Be Creative: Always be looking for ways to improve your business and to make it stand out from the competition. ...

Get Organized: ...

Be Consistent: ...

Analyze Your Competition: ...

Understand the Risks and Rewards: ...

Stay Focused:

Ability to become a leader: ...

Great decision-maker:

Explanation:

pls give brainliest i need 2 more to be an expert

8 0
3 years ago
A marketer makes a place decision by selecting channels of distribution. what does this mean?
san4es73 [151]

Answer:

A distribution channel is a chain of businesses or intermediaries through which a good or service passes until it reaches the final buyer or the end consumer. Distribution channels can include wholesalers, retailers, distributors, and even the Internet.

Explanation:

im a martial artist

8 0
3 years ago
Other questions:
  • A recent study on crime rates examines whether crime depends on sunshine. A researcher hypothesizes that sunshine makes people h
    15·1 answer
  • Kyg instruments, a firm that produces manufacturing equipment for various industries, experiences an influx of new sales employe
    13·1 answer
  • Jane has been working with some buyers for several weeks. She thinks they are really interested in one particular property, but
    7·1 answer
  • At a point when Robin Corporation has been in existence for six years, shareholder Ted transfers real estate (with an adjusted b
    11·1 answer
  • A corporate charter specifies that the company may sell up to 20 million shares of stock. The company issues 12 million shares t
    7·1 answer
  • If capital rents for $25 per unit per hour, labor can be hired for $9 per unit per hour, the level of total factor productivity
    15·1 answer
  • PLS HELP!!! THANK U<br> Sample Work: Writing an Informative Essay: Prewriting BATTLING ADVERSITY
    8·2 answers
  • Barlow Company manufactures three products—A, B, and C. The selling price, variable costs, and contribution margin for one unit
    14·1 answer
  • ABC Corporation is one of the largest energy companies in the United States, with over $50 million in publicly traded shares. Th
    9·1 answer
  • aliyah has started a mobile salon service. while she recognizes the risks involved in operating a business
    10·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!