If a country's economic data shows private savings of $990 million, government spending of $999 million, tax revenue of $699 million, imports of $600 million, and exports of $400 million, then what does investment equal?

Question

Madelyn Christensen

Business

18 August, 07:06

If a country's economic data shows private savings of $990 million, government spending of $999 million, tax revenue of $699 million, imports of $600 million, and exports of $400 million, then what does investment equal?

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Answers (1)

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Francis Flores · Answer 1

Investment is equal to 890 million.

Explanation:

Investment refers to the money that is used to produce goods. Investment can be calculated by adding the private savings, the public savings that is determined by subtracting the government spending to the taxes received and the trade deficit that refers to the imports minus the exports.

I = S + (T-G) + (M-X)

S = private savings

T = net taxes

G = government spending

M = imports

X = exports

I = 990 + (699-999) + (600-400)

I=990-300+200

I = 890