Complete # 3 a & b of Problems at the end of the chapter p. 284/680=666.   Describe the composition of the U.S. public debt related to domestic & foreign holdings.

1. Assume that the GDP of Country A, a commodity exporter, can take on the values of $50, $55, $60, $65, and $70 with equal probability. To smooth consumption, the government of Country A issues $10 government bonds and sell them in the global financial market. If the government default, the costs of default are 25% of GDP. Lenders are competitive and understand these risks fully. a) If the lending rate is 32.5% per annum, what is the country's repayment threshold level of GDP (i.e., the GDP at which it is indifferent between defaulting and repaying the loan)? What is its probability of default? At what GDP level(s) will the country default? b) If the interest rate on safe loans is 6% annum, is the lending rate of 32.5% consistent with the breakeven condition of a competitive lender? Show your answer. c) Assume that the GDP of Country A can now take on the value of $75 (in addition to the five values above) due to higher volatility in commodity prices. Use the consumption-output…

please draw a Real IR (Y axis) , Savings and Investment (X axis) graph to show what happens during a budget deficit. 1. Plotting Savings, and Investment 2. Plotting savings + Capital Inflow, and investment

Indepth recommendations on how debt-management may be improved in Barbados.

Assume a government decides to implement a new tax policy, resulting in a smaller budget deficit. Based on the national savings and investment identity, this would result in some combination of      private investment,      private savings, and/or      trade deficit. A-Higher; lower; higher B-Higher; lower; lower C-Lower; higher; higher D-Lower; higher; lower

Please help me with 6 and 8. Thank you

help please answer in text form with proper workings and explanation for each and every part and steps with concept and introduction no AI no copy paste remember answer must be in proper format with all working