Question: Question 1.1) [2 Marks] What condition has to hold for the sum of current accounts of the US, CAUS, and the rest of the

Question 1.1) [2 Marks] What condition has to hold for the sum

Question 1.1) [2 Marks] What condition has to hold for the sum of current accounts of the US, CAUS, and the rest of the world, CAR? That is, what is CAUS + CARW equal to? Question 1.2) [5 Marks] What are the effects of an exogenous increase in the world interest rate on the current account of the US and the current account of the rest of the world? Explain why the

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