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In a closed economy and three sector model which of the following is true ?

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In a closed economy and three sector model which of the following is true ?

(1) Household savings equal net investment

(2) Household savings equal gross investment

(3) Household savings plus depreciation equals gross investment plus government spending

(4) Household savings plus taxes plus depreciation equals gross investment plus government spending



Answer - (4) Household savings plus taxes plus depreciation equals gross investment plus government spending.
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