How is public saving calculated?

Public saving is calculated as the difference between government revenues and government spending. In this context, government revenues are represented by taxes (T), and government spending is represented by government expenditures (G). Therefore, public saving can be expressed using the equation (T - G).

This formulation effectively captures how much the government is saving or borrowing in a given period. If T (the amount collected from taxes) is greater than G (government spending), then the result is positive public saving. Conversely, if G exceeds T, it results in negative public saving, indicating a budget deficit.

The other options represent different economic calculations. The term (Y - T - C) represents private saving, which is the income remaining after households pay taxes and spend on consumption. The expression (C + G) represents total spending in the economy, combining consumption and government spending, rather than focusing on saving. Lastly, (Y - C) describes national saving but doesn't account for the role of taxes and government expenditures, which are crucial for determining public saving.