The national income is $19.74 trillion, consumption is 69% of national income, private investment is 16%...

The national income is $19.74 trillion, consumption is 69% of national income, private

investment is 16% of national income, and government spending is 18% of national

income. What is the current account balance?

a. $0.592 trillion

b. -$0.592 trillion

c. $0

d. Cannot be determined with the information given

(SHOW ALL WORK)

Expert Solution

Calculation of current account balance:

National income = 19.7400

Less: 69% consumption (69% of 19.74) = 13.6206

Private investment (16% of 19.74) = 3.1584

Government spending (18% of 19.74) = 3.5532

Current account balance = -0.5922

Hence option b is the correct answer. = -$ 0.592 trillion.

jeff jeffy answered 2 years ago

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