(a) State the equation for the general long-run budget constraint in terms of trade balances and initial external wealth

( No calculations necessary)

(b) Given the assumptions below, what is the numerical present value of trade balances in this example?

( No calculations necessary)

Assume that an infinitely lived country has initial external wealth of zero. That it produces output Q of 100 every year; private consumption C is 90 every year, government spending G is 10 every year, and investment is initially zero every year. The world and home interest rate is 10%