A country finds itself in the following situation: a government budget surplus of $630; total domestic savings of $990, and total domestic physical capital investment of $900. According to the national saving and investment identity, if investment increases by $830 while the government budget surplus and savings remain the same, what will be the new value of the trade deficit after the investment increase?

Select all of the following statements which can be said of a country with a current account deficit over the previous year: The country is exporting more than it is importing, assuming that net foreign aid and investment income is zero.   The country was a net borrower over the previous year.   Assuming zero net foreign aid and investment income, the country imported more than it exported.   The country will experience upward pressure on its currency prices.   The country must decrease its currency reserve account.

Discuss the role of budget surpluses and trade surpluses in national saving and investment

In 2008, a small country imported goods worth $900 billion and exported goods worth $343 billion. It exported services worth $248 billion and imported services worth $530 billion. Payments on investments abroad totaled $499 billion, while returns paid on foreign investments were $25 billion. Unilateral transfers from the country to other nations amounted to $81 billion. What was the country's merchandise trade deficit for 2008? (In billions of Dollars.)