Which formula represents private saving?

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Private saving is defined as the portion of disposable income that households do not consume and is an important component of the overall savings in an economy. To derive the formula for private saving, we start with the concept of disposable income, which is income after taxes (Y - T). From this disposable income, households allocate a portion to consumption (C) and save the remainder.

The formula for private saving is thus constructed as follows: When you take the total income (Y) and subtract taxes (T) to find disposable income, then subtract consumption (C), you arrive at the amount saved by households.

Therefore, private saving is accurately represented by the formula (Y - T - C), which calculates how much of the disposable income is being saved after accounting for consumption. This affirms that option A captures the essence of private saving effectively.