A large open economy has desired national saving of Sd = 20 + 200rw,and desired national investment of Id = 30 - 200rw.The foreign economy has desired national saving of = 40 + 100rw,and desired national investment of
= 75 - 400rw.
(a)Calculate the equilibrium values of rw,CA,CAFor,S,I,SFor,and IFor.
(b)Suppose Sd rises by 45,so that now Sd = 65 + 200rw.Calculate the equilibrium values of rw,CA,CAFor,S,I,SFor,and IFor.
(c)Suppose,with Sd back to Sd = 20 + 200rw,as in part (a),that Id rises by 45,to ?Id = 75 - 200rw.Calculate the equilibrium values of rw,CA,CAFor,S,I,SFor,and IFor.

Question

A large open economy has desired national saving of Sd = 20 + 200rw,and desired national investment of Id = 30 - 200rw.The foreign economy has desired national saving of  = 40 + 100rw,and desired national investment of
  = 75 - 400rw.
(a)Calculate the equilibrium values of rw,CA,CAFor,S,I,SFor,and IFor.
(b)Suppose Sd rises by 45,so that now Sd = 65 + 200rw.Calculate the equilibrium values of rw,CA,CAFor,S,I,SFor,and IFor.
(c)Suppose,with Sd back to Sd = 20 + 200rw,as in part (a),that Id rises by 45,to ?Id = 75 - 200rw.Calculate the equilibrium values of rw,CA,CAFor,S,I,SFor,and IFor.

Quizplus · Accepted Answer

The Answer of A large open economy has desired national saving of Sd = 20 + 200rw,and desired national investment of Id = 30 - 200rw.The foreign economy has desired national saving of  = 40 + 100rw,and desired national investment of
  = 75 - 400rw.
(a)Calculate the equilibrium values of rw,CA,CAFor,S,I,SFor,and IFor.
(b)Suppose Sd rises by 45,so that now Sd = 65 + 200rw.Calculate the equilibrium values of rw,CA,CAFor,S,I,SFor,and IFor.
(c)Suppose,with Sd back to Sd = 20 + 200rw,as in part (a),that Id rises by 45,to ?Id = 75 - 200rw.Calculate the equilibrium values of rw,CA,CAFor,S,I,SFor,and IFor.

A Large Open Economy Has Desired National Saving of Sd