Suppose a hypothetical open economy uses the U.S. dollar as currency. The table below presents data describing the relationship between different real interest rates and this economy’s levels of national saving, domestic investment, and net capital outflow. Assume that the economy is currently operating under a balanced government budget

The following graphs depict the market for loanable funds and the relationship between the real interest rate and the level of net capital outflow (NCO) measured in terms of the Mexican currency, the peso.   The Market for Loanable Funds in MexicoDemandSupply012345678987654321REAL INTEREST RATE (Percent)LOANABLE FUNDS (Billions of pesos)Demand   Supply      Mexican Net Capital OutflowNCO-4-3-2-10123456987654321REAL INTEREST RATE (Percent)NET CAPITAL OUTFLOW (Billions of pesos)NCO        Complete the first row of the table to reflect the state of the markets in Mexico.   Real Interest Rate Net Capital Outflow (NCO) (Percent) (Billions of pesos) Initial state     After capital flight       Now, suppose that Mexico experiences a sudden bout of political turmoil, which causes world financial markets to become uneasy. Because people now view Mexico as unstable, they decide to pull some of their assets out of Mexico and put them into more…

How does the graph look for the effect of a temporary but persistent increase in total factor productivity on current investment. I know that the x axis is the real interest rate and the y axis is level of current investment but im not sure how the graph should look. Could you show me what the graph should look like?

Government purchases of goods and services = $200 $150 = Taxes Consumer spending = $700 Markets for goods and services Gross domestic product Investment spending = $120 Exports = $30 Imports = $50 Government | Households Firms Rest of world Government borrowing = $70 Government transfers = $20 Reference: Ref 7(22)-2 Figure 7-2: Expanded Circular-Flow Model Private savings = $170 Wages, profit, interest, rent = $1,000 D) net exports of $80 Wages, profit, interest, rent = $1,000 Factor markets Borrowing and stock issues by firms = $120 Foreign borrowing and sales of stock = $110 Foreign lending and purchases of stock = $130 C) investment spending of $120 (Figure 7-2: Expanded Circular-Flow Model) Use Figure 7-2: Expanded Circular-Flow Model. How does the government finance its spending? A) taxes of $150 plus borrowing of $70 Financial markets B) foreign borrowing and sales of stock of $110

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Use the following graph (shifts in the supply of loanable funds) for the next five questions. Interest 6%- S3 rate 5- 3 S₁ S₂ $200 250 300 350 400 Savings (billions of dollars) Assuming the supply of loanable funds is at S1, which of the following represents an increase in the number of retired people in a nation? no change O a shift to $3 a movement down and to the left along S1 a movement up and to the right along S1 O a shift to S2

5. Saving and net flows of capital and goods In a closed economy, saving and investment must be equal, but this is not the case in an open economy. In the following problem, you will explore how saving and investment are connected to the international flow of capital and goods in an economy. Before delving into the relationship between these various components of an economy, you will be asked to recall some relationships between aggregate variables that will be useful in your analysis. Recall the components that make up GDP. National income (Y) equals total expenditure on the economy's output of goods and services. Thus, where C = consumption, I = investment, G = government purchases, X = exports, M = imports, and NX = net exports: Y = Also, national saving is the income of the nation that is left after paying for . Therefore, national saving (S) is defined as: S = Rearranging the previous equation and solving for Y yields Y = Plugging this into the original equation showing the…

5. Saving and net flows of capital and goods In a closed economy, saving and investment must be equal, but this is not the case in an open economy. In the following problem, you will explore how saving and investment are connected to the international flow of capital and goods in an economy. Before delving into the relationship between these various components of an economy, you will be asked to recall some relationships between aggregate variables that will be useful in your analysis. Recall the components that make up GDP. National income (Y) equals total expenditure on the economy's output of goods and services. Thus, where C = consumption, I = investment, G = government purchases, X = exports, M = imports, and NX = net exports: Y = Also, national saving is the income of the nation that is left after paying for Therefore, national saving (S) is defined as: S = Rearranging the previous equation and solving for Y yields Y = . Plugging this into the original equation showing the…

5. Saving and net flows of capital and goods In a closed economy, saving and investment must be equal, but this is not the case in an open economy. In the following problem, you will explore how saving and investment are connected to the international flow of capital and goods in an economy. Before delving into the relationship between these various components of an economy, you will be asked to recall some relationships between aggregate variables that will be useful in your analysis. Recall the components that make up GDP. National income (Y) equals total expenditure on the economy's output of goods and services. Thus, where C = consumption, I = investment, G = government purchases, X = exports, M = imports, and NX = net exports: Y = Also, national saving is the income of the nation that is left after paying for Therefore, national saving (S) is defined as: S = Rearranging the previous equation and solving for Y yields Y = Plugging this into the original equation showing the various…

5. Saving and net flows of capital and goods In a closed economy, saving and investment must be equal, but this is not the case in an open economy. In the following problem, you will explore how saving and investment are connected to the international flow of capital and goods in an economy. Before delving into the relationship between these various components of an economy, you will be asked to recall some relationships between aggregate variables that will be useful in your analysis. Recall the components that make up GDP. National income (Y) equals total expenditure on the economy's output of goods and services. Thus, where C = consumption, I = investment, G = government purchases, X = exports, M = imports, and NX = net exports: Y = Also, national saving is the income of the nation that is left after paying for saving (S) is defined as: S = Rearranging the previous equation and solving for Y yields Y = results in the following relationship: S This is equivalent to S= . Therefore,…