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Assume that the following details apply to the U.S. economy: Government budget deficit: $150 billion. Domestic Savings: $2,000 billion Domestic physical capital investment: $2,500 billion According to the national saving and investment identity, what will be the current account balance? A) $2,000 billion B) $2,650 billion C) $2,150 billion D) $650 billion

Assume that the following details apply to the U.S. economy: Government budget deficit: $150 billion. Domestic Savings: $2,000 billion Domestic physical capital investment: $2,500 billion According to the national saving and investment identity, what will be the current account balance? A) $2,000 billion B) $2,650 billion C) $2,150 billion D) $650 billion

Principles of Economics 2e
Principles of Economics 2e
2nd Edition
ISBN:9781947172364
Author:Steven A. Greenlaw; David Shapiro
Publisher:Steven A. Greenlaw; David Shapiro
Chapter23: The International Trade And Capital Flows
Section: Chapter Questions
Problem 44P: Imagine that the U.S. economy finds itself in the following situation: a government budget deficit...
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Assume that the following details apply to the U.S. economy:

  • Government budget deficit: $150 billion.
  • Domestic Savings: $2,000 billion
  • Domestic physical capital investment: $2,500 billion

According to the national saving and investment identity, what will be the current account balance?

A) $2,000 billion
B) $2,650 billion
C) $2,150 billion
D) $650 billion
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