Question

3- Find the 3 errors in the following text. CHINA’S UNBELIAVABLE NATIONAL SAVINGS RATE China’s national savings rate, quite recently exceeding 50%, is the highest among the major economies in the world. In any economy, the national savings is composed of the savings of households, firms, and the government. In China the household savings, making up about half of national savings, is the biggest component of national savings. Firms also make a big contribution to China’s savings rate. However the government, because of budget deficits, makes a negative contribution; meaning it doesn’t contribute but use up savings of households and firms. One Child Policy, through the Demographic Dividend effect is the most important factor explaining the fast rise in the household saving rate in 2000’s. The saving boosting impact of this policy is expected to grow larger as the population ages in China. Another factor behind the rise in China’s household savings rate is the fast rise in disposable incomes in the country. The high level of income equality in China also contributes positively to country’s high savings rate.

Answer 1

ERROR 1 : The govt because of budget deficits make a negative contribution to savings rate.

Correction 1 : The govt has not run any large budget deficits or surpluses recently .

ERROR 2 : The saving boosting policy is expecyted to grow larger as the population ages in China.

Correction 2 :The savings are expected to decline as the population ages .

ERROR 3 : The high level of income equality in China

Correction 3 : There is high level of income inequality in China.