Desired national saving: s= $20 billion+ ($400 billion) Desired investment: /"$40 billion ($400 billion)x": Output: Y $200 billion; Government purchases: G= $40 billion; World real interest rate: 8%. a. Find the values of the following variables: (Round) answers to one decimal place. All values in billions of dollars.) National saving = S Investment = $ Net exports - S Current account balance = $ Consumption = S Absorption $ b. Owing to a technological innovation that increases future productivity, the country's desired investment rises by $2 billion at each level of the world real interest rate. Find the new values of the variables: (Round all answers to one decimal place. All values in billions of dollars.) National saving = $ Investment = $ Net exports = $ Absorption = $

ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
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3
In a small open economy,
Desired national saving: 5= $20 billion+ ($400 billion).
Desired investment:
$40 billion ($400 billion)**;
Output: Y= $200 billion;
Government purchases: G = $40 billion;
World real interest rate: /* = 8%.
a. Find the values of the following variables: (Round all answers to one decimal place. All values in billions of dollars.)
National saving = $
Investment = $
Net exports = $
Current account balance = $
Consumption S
Absorption = $
b. Owing to a technological innovation that increases future productivity, the country's desired investment rises by $2 billion at each level of the world real interest rate. Find the new values of the variables: (Round all answers to one decimal
place. All values in billions of dollars.)
National saving = $
Investment = $
Net exports = $
Absorption = $
Transcribed Image Text:In a small open economy, Desired national saving: 5= $20 billion+ ($400 billion). Desired investment: $40 billion ($400 billion)**; Output: Y= $200 billion; Government purchases: G = $40 billion; World real interest rate: /* = 8%. a. Find the values of the following variables: (Round all answers to one decimal place. All values in billions of dollars.) National saving = $ Investment = $ Net exports = $ Current account balance = $ Consumption S Absorption = $ b. Owing to a technological innovation that increases future productivity, the country's desired investment rises by $2 billion at each level of the world real interest rate. Find the new values of the variables: (Round all answers to one decimal place. All values in billions of dollars.) National saving = $ Investment = $ Net exports = $ Absorption = $
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