Consider a small open economy. Suppose there is an increase in the expected future marginal product of capital. Without other changes, we can expect that saving curve will shift to the left and the current account balance will decrease. saving curve will shift to the right and the current account balance will increase. investment curve will shift to the left and the current account balance will increase. investment curve will shift to the right and the current account balance will decrease.

Consider a small open economy. Suppose there is an increase in the expected future marginal product of capital. Without other changes, we can expect that saving curve will shift to the left and the current account balance will decrease. saving curve will shift to the right and the current account balance will increase. investment curve will shift to the left and the current account balance will increase. investment curve will shift to the right and the current account balance will decrease.

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter23: The International Trade And Capital Flows

Section: Chapter Questions

Problem 46P: Imagine that the economy of Germany finds itself in the following situation: the government budget...

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