Question

In Axel Island, GDP is $15 trillion, consumption is $10 trillion, and government spending is $2.5 trillion. Taxes are $1 trillion, and the net capital inflow is $0.5 trillion. National savings in Axel Island is $_____ trillion. Please choose the correct answer from the following choices, and then select the submit answer button. Answer choices 1

Answer 1

$1.5 trillion

Step-by-step explanation:

The national savings of a country include both household savings and savings gotten from nation’s businesses and government.Total national saving is measured by the national income in form of consumption and taxes and is the same as national investment. Thus, in national income accounts, saving is always equal to investment.

Total savings = national savings (in form of taxes) + net capital inflow = $1 trillion + $0.5 trillion = $1.5 trillion

Answer 2

Answer: $3 trillion

Step-by-step explanation:

GIVEN the following ;

Gross domestic product = $15 trillion

Consumption = $10 trillion

Government spending = $2.5 trillion

Taxes = $1 trillion

Net capital inflow = 0.5 trillion

National savings =?

National savings = Gross Domestic product - (Consumption + Government spending)

National savings = $15 trillion - ( $10 trillion + 2.5 trillion)

National savings = $15 trillion - $12.5 trillion = $2.5 trillion

Total savings = National saving + net capital inflow

Total savings = $2.5 trillion + $0.5 trillion = $3 trillion