Please double-check if this is correct Suppose that Westeros continues to run a

Question

Please double-check if this is correct

Suppose that Westeros continues to run a large trade deficit with the Brav^Consider Westeros and Bravos, as the only two countries in the world and both are large open_economies. Construct three diagrams showing savings, investment, net capital outflows and net exports in Bravos, Westeros, and the World market. Be sure to label everything, including the real world interest rate, and explain how the three graphs are related. Redraw and show what happens in all graphs with a decrease in current income in BravosJfe sure to tell/show me what happens to savings and investment in each country.

Explanation / Answer

Answer for A and B is Fine. As the income decreased, savings fall as they are directly related. Be sure to make the old an new equilibrium points in question B

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