Savings and investment are always equal. …
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Posted by Pooja Agarwal 6 years, 5 months ago
- 2 answers
Yogita Ingle 6 years, 5 months ago
S and I ean be realised (ex-post) or planned (ex-ante). Planned S and planned I are equal only at equilibrium level. Realised S and realised I are always equal. The equality is derived as,
Y = C + S and Y = C + I
Hence, S = I
So, in ex-ante sense, saying and investment may or may not be equal, but in ex-post sense, saving and investment are always equal.
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Aarohi ??? 6 years, 5 months ago
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