1. Suppose, in a two-sector model, that individuals receive the following payments from the business sector: wages $520, interest $30 rent $ 10 and profits $80. Consumption spending is $550 and investment is $90.
a. Find the market value of output and household saving
b. What is the relationship of saving and investment?
a) the market value of final output is $640, found by adding wages of $520 + interest of $30 + rent of ...
Determine the relationship between saving and investment.