QUESTION 3. Heckscher-Ohlin Model and Intertemporal Trade. 15 POINTS. There are two countries, Brazil and Saudi Arabia, and two goods, consumption today (Cp) and consumption tomorrow (Cf). Assume Saudi Arabia "exports" current consumption", and Brazil "exports" future consumption. a) Which country is a net lender today? Net borrower today? What does that mean in terms of capital flows between these two countries today? And in terms of their current accounts today?~ b) Graph the intertemporal production possibilities frontier for Brazil under the assumption above. Toward which good is Brazil's PPF biased?~ c) If the world interest rate were r, show, on the graph above, how much current consumption (Cp) and future consumption (Cf) Brazil would produce. Label these quantities qlp and qif. - Cp d) Show how much current consumption (Cp) and future consumption (Cf) Brazil consumes on the graph above. Label these quantities dip and dif. Draw as many indifference curves as you need to. ~e) g) 11) If the world interest rate increases, show, on the graph above, how the production of current consumption (Cp) and future consumption (Cf) would change in Brazil. Label these quantities qu and q2f