Question
Consider a hypothetical global economy consisting of three countries (A, B, C). International trade occurs among these countries. Their bilateral trade of 2020 in goods
Consider a hypothetical global economy consisting of three countries (A, B, C). International trade occurs among these countries. Their bilateral trade of 2020 in goods and services is summarized as follows:
Country A exports to Country B --------------- $100
Country A exports to Country C --------------- $310
Country B exports to Country A --------------- $220
Country B exports to Country C --------------- $430
Country C exports to country A --------------- $150
Country C exports to Country B --------------- $260
a) Compute Country As external trade balance?
b) Compute Country Bs external trade balance?
c) Compute Country Cs external trade balance?
d) Must the global economy as a whole have balanced trade? Why? Or why not?
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