Question

During the Reagan era, 1981–1988, the U.S. current account moved from a tiny surplus to a large deficit. The following table provides U.S. macroeconomic data for that period.
a. Based on these data, to what extent would you attribute the changes in the U.S. current-account balance to a decline in the U.S. private saving-investment balance?
b. To what extent would you attribute the changes in the U.S. current-account balance to an increase in the U.S. government budget deficit?
c. Based on these data, what was the excess of national spending over national income during thisperiod?


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  • CreatedJune 27, 2014
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