Question

1) in National Accounting Model 5, we have the following:

Household savings = 5,000

Firm savings = 0

Government savings = -3,000

ROW savings = 4,000

Then National Investment must be...

Group of answer choices

6,000

12,000

5,000

0

2) A country's National Product includes the goods and services purchased by the government.

True or False

Answer 1

Q2) ans: true

GNP is equal to consumption, government spending, capital spending by businesses, and net exports and net income by domestic residents and businesses from overseas investments. The money that a spends procuring goods or services from the private sector. It include a local goverment hiring a company to repair a road or goverment buying equipment for the military, govt expenditure on street light etc are included in under the head of government final consumption expenditures.

Q1. Investment = household saving + govt saving + rest of the world saving (ROW savings)

= 5000 +(-3000) + 4000

=9000 - 3000 = 6000

Ans : 6000