Assume an economy has government spending of $200, taxes of $150, and an investment of $250. What is private saving?

a. $100

b. $200

c. $300

d. $400

The correct answer is c. $300,

This is because the investment in an economy is equal to the sum of public and private savings. As given in the case, investment is equal to $250. The public savings can be determined by the difference in tax revenue and government spending. Here, public savings $50 ($200-$150) are negative. This is because government spending ($200) exceeds the tax revenue ($150). The private savings are determined by the sum of public dissavings ($50) and investment ($250). So, private savings are $300.