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?
AThere is not enough information to determine what will happen to saving
BThere is an increased in saving and the economy should grow more quickly
CThere is a decrease in saving and the economy should grow more slowly
DSaving is unchanged
Correct answer
D. Saving is unchanged
Explanation
The correct answer is Saving is unchanged.