Do exercise 5.6 please (it instructs you to do parts of 5.5 with given constraints), thank you.

Exercise 5.6 (An Open Economy With Investment II) Answer questions 2-4 and 6-7 of Exercise 5.5 assuming that Bo =0 and Io = 16. Do this twice, once under the assumption that the economy is open and once under the assumption that the economy is closed. Discuss the extent to which your numerical solution conforms (or does not conform) with the qualitative solution given in Table 5.1.Exercise 5.5 (An Open Economy With Investment I) Consider a two-period model of a small open economy with a single good each period. Let preferences of the representative household be described by the utility function In Ci + In Cz. where Ci and Cz denote consumption in periods 1 and 2. Each period the household receives profits from the firms it owns, denoted I, and 12. Households and firms have access to financial markets where they can borrow or lend at the interest rate 1. The production technologies in periods 1 and 2 are given by Q1 = Allo and Q2 = Azh. where Q, and Q2 denote output in periods 1 and 2, Jo and I, denote the capital stock in periods 1 and 2, A, and Az denote the productivity factors in periods 1 and 2, and of is a parameter. Assume that Io = 16, A] = 35, Ay = 3.2, and o = 3. At the beginning of period 1, households have Be = 8 bonds. The interest rate on bonds held from period 0 to period 1 is ro =0.25. In period 1, firms borrow the amount D, to purchase investment goods that become productive capital in period 2, I1 - Assume that there exists free international capital mobility and that the world interest rate, denoted r*, is 20 percent. 1. Compute output and profits in period 1. 2. Compute the optimal levels of investment in period I and output and profits in period 2. 3. Solve for the optimal levels of consumption in periods 1 and 2. 4. Find the country's net foreign asset position at the end of period 1, denoted B1, saving, S1, the trade balance, TBj, and the current account, CA]- 5. Now consider an interest rate hike in period 1. Specifically, assume that as a result of turmoil in international financial markets, the world interest rate increases from 20 percent to 50 percent in period 1. Find the equilibrium levels of saving, investment, the trade balance, the current account, and the country's net foreign asset position in period 1. Provide intuition. 6. Suppose that the interest rate is 20 percent, and that A, increases to 4. Cal- culate the equilibrium values of output, consumption, saving, investment, and the current account in period 1. Provide an intuitive interpretation of the adjustment to the transitory productivity shock. 7. Suppose that the interest rate is 20 percent, that Al =3;, and that A2 increases from 3.2 to 4. Calculate the equilibrium values of consump- tion, saving, investment, and the current account in period 1. Explain your findings