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Consider a small open economy with desired national saving of $ - 20 + 200pl and desired investment of / - 30 - 200rly. a)
Consider a small open economy with desired national saving of $ - 20 + 200pl and desired investment of / - 30 - 200rly. a) Calculate national saving, investment, and the trade balance (i.c., net exports) in equilibrium for each of the world real interest rates listed in the Table below. Be sure to show your work in each cell of the Table. (6 points) World real interest National Saving (8) Desire Investment Net Exports (NX) rate PW - 0.025 FW - 0.05. b) Now suppose something causes desired national saving to increase by 10, so that it is now 5-30+ 200r. Complete the following Table with the new saving function. Show all your work. (6 points) World real interest National Saving (8) Desire Investment Net Exports (NX) rate FW - 0.025 PW - 0.05. c) Suppose that with desired national saving at its original level of $ - 20 + 200ple, something causes desired investment to rise by 10, to / - 40 - 200r. Complete the following Table with the new saving function. Show all your work. (6 points) World real interest National Saving (S) Desire Investment Net Exports (NX) rite PW - 01025 FW - 0.05
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