Consider the following scenario in the hypothetical country of Zootopia:

The government budget deficit is $80 billion, total domestic savings are $1.2 trillion, and total domestic investment in physical capital is $1.3 trillion. . According to the national savings and investment identity, what will be the current trade balance? Furthermore, suppose that investment increases by $30 billion while the budget deficit and national savings remain unchanged. What will be the new current trade balance?

Answer rating: 100% (QA)

According to the national savings and investment identity the current trade balance can be calculate... View the full answer