In an open economy where net exports are 10% of GDP, consumption is 65% of GDP, and taxes net of transfers are 35% of total consumption and investment. If government spending is less than investment, which of the following statements is true?

A. Private saving is greater than 10% of GDP

B. Investment is greater than 15% of GDP

C. Private saving is greater than public saving

D. Public saving is less than 10% of GDP

E. More than one of the options listed is correct

Answer rating: 100% (QA)

Lets break down the information given 1 Net exports are 10 of GDP 2 Consumption is 65 of GDP 3 Ta... View the full answer