The supply of loanable funds is equivalent to: A. national saving. B. private saving. C. public...

Question

Question

The supply of loanable funds is equivalent to:

A. national saving.

B. private saving.

C. public saving.

D. investment.

Answer 1

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Answer #1

The national income identity is

Y= C+I+G

Y-C-G=I

The term Y-C-G is the output that remains after the demand of consumers and government have been satisfied.

It is called national saving. This saving is the supply of loanable funds.

The correct answer is (A) national savings.

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Answer 2

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