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hi , i need someone to answer this question please As a small open economy. Malaysia economy is influenced by the world price market. We
hi , i need someone to answer this question please
As a small open economy. Malaysia economy is influenced by the world price market. We assumed Malaysia has desired national saving of Sd = 35 + 300rw, and desired national investment of / = 30 - 300rW. The foreign economy has desired national saving of $ Far - 30 + 250/W, and desired national investment of I For = 75 - 400rW. Based on this information, calculate the following: where CA is Current Account; For is Foreign; r" is world interest rate. (a) Compute the equilibrium values of rw, CA. CAFor 5. 1. 5For, and IFor [6 Marks] (b) Suppose Sd rises by 30, so that now Sd = 65 + 200/w. Compute the equilibrium values of PW. CA, CAFor 5. I, SFor and IFor [7 Marks] (c) Suppose, with S back to S = 35 + 300PW, as in part (a), that Jo rises by 45, to Ad = 75 - 300rw. Compute the equilibrium values of rw, CA. CAFor S. I. SFor, and IFor [7 Marks]Step by Step Solution
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