question 1.1-3

Exports 400 Imports 500 Profit made by foreigners owning US 100 businesses Profit made by US residents owning 200 foreign businesses Net transfers 1. Calculate the trade balance. Is it a trade surplus, trade deficit, or neither? Is it an inflow, outflow, or neither? 2. Calculate the current account balance. Is it a surplus, deficit, or neither? Is it an inflow, outflow, or neither? 3. What is the capital account balance? Is it a surplus, deficit, or neither? Is it an inflow, outflow, or neither? Briefly explain how you know