If the public consumes Rs 100 billion less and the government purchases Rs100 billion more (other things unchanging), Which of the following statement is true ?

A. Saving is unchanged
B. There is an increased in saving and the economy should grow more quickly
C. There is a decrease in saving and the economy should grow more slowly
D. There is not enough information to determine what will happen to saving

Correct Answer: Saving is unchanged ✔

Last Updated: June 18, 2019