3. Effects of a government budget deficit Suppose a hyoothetical ogen nconomy uses the U.S. dollar as currency. The table below presants data describing thie ralationship between different teal interest rates and this eccanemy's levels of natiocal saving, donnetic invectement, and net capital outfow. Assume that the aconony is currently neetatine undet a balanced government budget. Given the information in the table above, use the blue points (circle symbol to plot the demand foc ioanable funds. Next, use the orance points (square symbol) to piot the supply of hanable finds. Finaly, wse the black point (cross symbol) to indicate the equabrum in this markat. On the folbwing eraghy phot the reiationship between the peal interest rate and net capiar oughow by using the green poincs ferangle symoon to piot rate your derived in the previoes ouaph. Bocave of the rolationsh. b between net capital outtiow and net exports. the level of net capital euthlow at the equilibrium real intereot rate impiles that the ecenomy 15 experiencing NoW. suppose, the government is experiencing a budgot deficit. This meand that loansbie fundsi After the budget defiot occure; suppose the new esulibrium feal interest rate is osw, The fohrowing graph ahow the demand curve in the fersign. curienty oxchange manst. Use the green line (trangle symbol) to show the supoly curve in this marhet before the budget defict. Then use the purple lane (diamond kymbel to thow the supall curve after the budget defict. summares the eftect of a buopet oshet br thimp in the following tabie: 3. Effects of a government budget deficit Suppose a hyoothetical ogen nconomy uses the U.S. dollar as currency. The table below presants data describing thie ralationship between different teal interest rates and this eccanemy's levels of natiocal saving, donnetic invectement, and net capital outfow. Assume that the aconony is currently neetatine undet a balanced government budget. Given the information in the table above, use the blue points (circle symbol to plot the demand foc ioanable funds. Next, use the orance points (square symbol) to piot the supply of hanable finds. Finaly, wse the black point (cross symbol) to indicate the equabrum in this markat. On the folbwing eraghy phot the reiationship between the peal interest rate and net capiar oughow by using the green poincs ferangle symoon to piot rate your derived in the previoes ouaph. Bocave of the rolationsh. b between net capital outtiow and net exports. the level of net capital euthlow at the equilibrium real intereot rate impiles that the ecenomy 15 experiencing NoW. suppose, the government is experiencing a budgot deficit. This meand that loansbie fundsi After the budget defiot occure; suppose the new esulibrium feal interest rate is osw, The fohrowing graph ahow the demand curve in the fersign. curienty oxchange manst. Use the green line (trangle symbol) to show the supoly curve in this marhet before the budget defict. Then use the purple lane (diamond kymbel to thow the supall curve after the budget defict. summares the eftect of a buopet oshet br thimp in the following tabie
