*A country finds itself in the following situation: the government budget surplus is 2% of its GDP; private savings is 30% of GDP; and physical investment is 33% of GDP. Based on the national saving and investment identity, what is this country’s current account balance?
A. deficit of 2% of GDP
B. surplus of 1% of GDP
C. deficit of 1% of GDP
D. deficit of 3% of GDP
Answer:C
*A country finds itself in the following situation: the government budget surplus is 2% of its GDP; private savings is 30% of GDP; and physical investment is 33% of GDP. Based on the national saving and investment identity, what is this country’s current account balance?
A. deficit of 2% of GDP B. surplus of 1% of GDP C. deficit of 1% of GDP D. deficit of 3% of GDP
Explanation: Type: Multiple Choice