Question

In: Economics

Private saving is 227, taxes equal 76. and government purchases are 76. If investment is 190,...

Private saving is 227, taxes equal 76. and government purchases are 76. If investment is 190, calculate the trade balance/net exports (NX) for a small open economy. Enter your answer only.

Net exports equal -79, private saving is 159, and investment is 107. Calculate public saving. Enter your answer only.

Private saving is 207, taxes equal 99, government purchases are 77, and investment is 140. Calculate net capital outflows. Enter your answer only.

Solutions

Expert Solution

1) Saving - Investment = Net exports

Public saving + Private saving - Investment = NX

NX = (T - G) + 227 - 190

NX = (76 - 76) + 227 - 190

= 37

Net exports = 37

2) Public saving + Private saving - Investment = NX

Public saving + 159 - 107 = -79

Public saving = -131

3) Public saving + Private saving - Investment = NCO

NCO = (99 - 77) + 207 - 140

= 89

NCO = 89


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