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Exercise 1.9 Suppose the world consists of two countries, country A and country C. 1. Let NIIPA denote the net foreign asset position of country
Exercise 1.9 Suppose the world consists of two countries, country A and country C. 1. Let NIIPA denote the net foreign asset position of country A. Find the net foreign asset position of country C. 2. Let 0AA denote the current account balance of country A. Find the current account balance of country C. 3. Let AA denote foreign assets owned by residents of country A and LA denote country Als assets owned by residents of country C. Find the foreign asset and liability positions of country 0 denoted AC and LC, respectively. 4. Assume that the value of country A's foreign liabilities increases by 20 International Macroeconomics, Chapter 1, July 31, 2019 47 percent. Find the change in the net foreign asset position of country A and country C. Find the valuation changes for country A and C. To which extend are valuation changes a zero sum game
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