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3) Your country, a small open economy, is running a trade surplus. Using the national income accounts identity for the open economy ( Y =
3) Your country, a small open economy, is running a trade surplus. Using the national income accounts identity for the open economy ( Y = C + I + G +(X - M)) list four variables derived from this expression, other than X or M, so that the national economy can move this trade surplus (X - M greater than zero) to a deficit. Show, using the logic of this national income accounts identity, how you identified each of these four variables and what would have to happen to each.
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