An economy has a budget surplus of $900, private savings of $2,000, and investment of $1,300. 1. Write out the national savings and investment identity. 2. What will be the balance of trade in this economy? Show your work! 3. Suppose that the budget surplus change to a budget deficit of $900, with private saving and investment unchanged. What is the new balance trade in this economy? Does the economy run now a trade deficit or a trade surplus? Show your work!

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