Q: Why are budget deficits and trade deficits sometimescalled the twin deficits?
A: A budget deficit is a situation that is faced by the government when its total spendings exceed the…
Q: 3. Explain the relationship between a current account deficit or surplus and the flow of funds.
A: Current account of the country shows a deficit when the country in engaged in importing more goods…
Q: 9. If the central banks sells bonds in the open market, net exports will increase. Answer: Reason:
A: The sale of domestic goods and services on the international market is referred to as exporting.…
Q: The table below shows data on U.S. exports and imports of goods and services for five years. For…
A: The difference between the exports and the imports would result in the net exports. The net exports…
Q: and Saving (S) Suppose that at this level of national saving, the government of Slovappa has a…
A: National savings is given as National savings= Private savings + government savings (Government…
Q: Assume that the Gross Domestic Product is $6000, personal disposal income is $5100, the government…
A: Private saving is the amount that people save from their income. Investment is the amount a consumer…
Q: The great country of Naboombu has private savings of $700 billion, investment of $800 billion, tax…
A: Government surplus refers to the money left with the government after carrying out developmental…
Q: Exercise 2 Using the Key Account Identity and assume the numbers you select has been representative…
A: Financial assets and liabilities, such as loans, shares, investment funds, and pension funds, are…
Q: 11.(a) Find an expression for the IS curve of the domestic economy. There is no need to show…
A: IS curve shows the goods market equilibrium. It is derived by the equilibrium of aggregate demand…
Q: Assume an economy has a budget surplus of 1,000, private savings of 4,000, and investment of 5,000.…
A: The national saving and investment identity illustrates the relationship between the sources of…
Q: If planned aggregate expenditures (AE) are $500 billion, consumption (C) is $250 billion, investment…
A: AE = C + I + G + NX where NX = X-M where X is imports and M is imports
Q: Why is the bilateral trade deficit between 2 countries a bad measure of whether those countries…
A: The balance of trade is a metric that tracks the movement of exports and imports through time. A…
Q: -How is the balance of payments linked to national saving and investment? Explain.
A: The method used to monitor all the international transactions of a country, in a given period of…
Q: 4. Prepare the national savings and national investments accounts?
A: The national savings rate is the Gross Domestic Product that is saved rather than an expenditure of…
Q: private domestic savings = $1220, the trade deficit = $90. Find private %3D %3D
A: Gross private domestic investment, or GPDI, is a measure of the amount of money that domestic…
Q: Assume that GDP is $6500, personal disposable income is $5600, and the government budget deficit is…
A: Saving refers to the portion of disposable income after made all the expense. In other words, saving…
Q: 11. Suppose there are three adjacent countries maintaining their closed economic borders, i.e.…
A: The excess of government expenditure over government revenue is the government budget deficit.…
Q: In 2010, the economy of Minitown exported $1800 worth of goods and services and imported $1550 worth…
A: The balance of trade or the trade balance is the difference between the value of exports and the…
Q: C= 40 + 0.75 (Y-T), I-80, G=50, and T=60 Imports and exports are given by: IM =0.25Y and X-0.3Y*…
A: Answer; Solution : Giventhat : A) AE=C+I+G+NX…
Q: Problem 2. Answer the following questions briefly. a) What items are excluded from the calculation…
A: a) Basically, something has to be produced in order for it to be included in our GDP. It must be…
Q: Suppose that a vaccine manufacturing company owned entirely by U.S. citizens opens a new facility in…
A: a)Foreign direct investment. b)Canada GDP would increase and U.S GDP would be unaffected.
Q: II. Problem Solving: An economy shows the following features: (All figures are in Php) Consumption…
A: Given Consumption function C = 50+ 0.9(Y-T) ......... (1) Tax revenue: T = 100 Government…
Q: 1. The main objective of the macroeconomics to improve the standard of living of people whereas, to…
A: Macroeconomics objective: the goal of macroeconomic approaches is to expand the degree of public…
Q: Question 2 (a) Distinguish between a government deficit and trade deficit? (b) Would you rather live…
A: "Since you have asked multiple questions, we will solve the first question for you. If you want any…
Q: b) How does stimulative fiscal policy affect the exchange rate? c) How does stimulative fiscal…
A: Fiscal policy refers to the action taken by the government to interfere in the market and push the…
Q: uppose A&K Sound System is considering building a record studio in Cayman Islands. (i) Assume…
A: Answer in Step 2
Q: (a) Distinguish between a government deficit and trade deficit? (b) Would you rather live in a…
A: Fiscal Deficit A Government Deficit is the amount of money in the established budget by which…
Q: The following graph shows a relationship between saving (S), investment (I) and world interest rate…
A: At world interest rate r, the saving is more than the investment, so the country is a net lender and…
Q: What is a foreign trade deficit or surplus? How does this affectinterest rates?
A: Foreign trade refers to the trade between two or more countries and trade includes the services of…
Q: What is the difference between foreign sales revenues and foreign purchase expenses called? A)…
A: The term 'foreign' is used to define other countries than the home country. It includes any country…
Q: (a) Distinguish between a government deficit and trade deficit?
A: Deficit occurs when you receive is less amount as compared to the amount you have spent. Government…
Q: uppose a country has total GDP (Y) = $10 trillion, consumption = $7 trillion, government spending =…
A: Calculation of the Gross Domestic Product: The GDP is the monetary value of both goods and services…
Q: 1) Consider economy T described by the parameters below: C=1500+0.6Y I = 1200 G=2500 X =500 M =…
A: Aggregate demand represents the total demand for all final goods and services that an economy…
Q: 2. From the table, relate Fiscal balance and Current account balance. Analyze why both show negative…
A: When the current account balance (CAB) is negative it is known as the current account deficit (CAD).…
Q: (a) Distinguish between a government deficit and trade deficit?
A: Deficit alludes to the circumstance when the use surpasses the pay of an individual or a firm. The…
Q: “Fiscal policy is completely crowded out in a smnall open economy with floating exchange rate…
A: Fiscal policy is used by the government to stabilize the economy. The tools of fiscal policy are…
Q: Question 2 (a) Distinguish between a government deficit and trade deficit? (b) Would you rather live…
A: We’ll answer the first question only (b) since all are unrelated. Please submit a new question…
Q: Suppose that the government decides to cut spending. In a three graphs diagram, show theimpact of…
A: A decline in government spending implies contractionary fiscal policy. Fall in public spending…
Q: Ques tion 2 (a) Distinguish between a government deficit and trade deficit? (b) Would you rather…
A: Answer (d): (1). There is an inverse relationship between the price of the bond and the interest…
Q: What is the difference between a government deficit and a trade deficit ?
A: Trade deficit occurs in an economy when the imports exceed the exports in the country. The country…
Q: If a country is experiencing a budget deficit and the government reduced spending, resulting in a…
A: The process of budgeting where the total planning spending is equal to total expected revenues is…
Foreign investment refers to the capital flow from one country to another, this grants the foreign investors extensive ownership in domestic companies and assets. As a result of their investment, foreigners get an active part in the management of their equity, this share is large enough for foreigners to influence the business strategy. The trends towards globalization has led to large multinational companies investment in other countries
Net exports are a measure of total trade of a nation, they are defined as total exports minus total imports. If they are negative, it means that the imports are more than the exports.
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- What is a foreign trade deficit or surplus? How does this affectinterest rates?Question 68 The great country of Naboombu has private savings of $700 billion, investment of $800 bilion, tax revenue of $5s00 billion, and ment expenditures of $350 billion. What is the trade balance, does the country have a trade surplus or deficit, and is the net lender or borrower international (respectively)? the trade balance is $50 billion, the country has a trade surplus, and the country is a net borrower internationally O the trade balance is S-150 billion, the country has a trade deficit, and the country is a net lender internationally the trade balance is $50 billion, the country has a trade surplus, and the country is a net lender internationally x the trade balance is $-50 billion, the country has a trade deficit, and the country is a net borrower internationallyFind the revenue deficit???
- What is the difference between a government deficit and a trade deficit ?1. Imports, exports, and the trade balanceThe following table shows the approximate value of exports and imports for the United States from 1997 through 2001.Complete the table by calculating the surplus or deficit both in absolute (dollar) terms and as a percentage of GDP. If necessary, round your answers to the nearest hundredth.YearGDPExportsImportsExports – Imports(Billions of dollars)(Billions of dollars)(Billions of dollars)(Billions of dollars)(Percentage of GDP)19978,332.0 954.41,055.8 19988,794.0 953.91,115.7 19999,354.0 989.31,251.4 20009,952.0 1,093.21,475.3 200110,286.0 1,027.71,398.7 Source: “Income, Expenditures, Poverty, & Wealth: Gross Domestic Product (GDP),” United States Census Bureau, United States Department of Commerce, last modified September 2011, accessed June 10, 2013, https://www.census.gov/library/publications/2011/compendia/statab/131ed/income-expenditures-poverty-wealth.html. Between 1997 and 1998, the in dollar terms and as a percentage of GDP.(1) Consumption function: C = 100 + .8Y (2) Planned investment: I = 38 (3) Government spending: G = 75 (4) Exports: EX = 25 (5) Imports: IM = .05 Y4 (6) Disposable income: Y = Y- T (7) Taxes: T= 40 (8) Planned aggregate expenditure: AE = C+I+ G+ EX– IM (9) Definition of equilibrium income: Y = AE
- 4. Analyzing the effects of a trade deficit You have just been hired by the U.S. government to analyze the following scenario. Suppose the U.S. agricultural industry is concerned about the level of fruit and vegetable imports to the United States, a practice that hurts domestic producers. Lobbyists claim that implementing a tariff on imports would shrink the size of the trade deficit. The following exercise will help you to analyze this claim. The following graph shows the demand and supply of U.S. dollars in a model of the foreign-currency exchange market. Shift the demand curve, the supply curve, or both to show what would happen if the government decided to implement the tariff. Supply IN Demand QUANTITY OF DOLLARS REAL EXCHANGE RATE (Units of foreign currency per dollar) Demand Supply ?The balance of trade show a deficit of $5000 and the value of imports are $9000what is the value of export4. Analyzing the effects of a trade deficit You have just been hired by the U.S. government to analyze the following scenario. Suppose the U.S. agricultural industry is concerned about the level of fruit and vegetable imports to the United States, a practice that hurts domestic producers. Lobbyists claim that implementing a tariff on imports would shrink the size of the trade deficit. The following exercise will help you to analyze this claim. The following graph shows the demand and supply of U.S. dollars in a model of the foreign-currency exchange market. Shift the demand curve, the supply curve, or both to show what would happen if the government decided to implement the tariff. REAL EXCHANGE RATE (Units of foreign currency per dollar) QUANTITY OF DOLLARS Given this change, the dollar Supply Change due to a tariff Demand Fill in the following table with the effect of a tariff on the following items: Demand Supply (?) Demand for Loanable Funds Real Interest Rate National Saving Net…