(Solved): Assume that in a small open economy where full employment always prevails, na ...

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Assume that in a small open economy where full employment always prevails, national saving is 250 . a. If domestic investment is given by $I=550?24\mathrm{r}$, where $r$ is the real interest rate, what would the equilibrium "r" be if the economy were closed? b. If the economy is open and the world interest rate is 12 percent, what will investment be? c. Using your answer from part b., what is the current account surplus/deficit (use a "-" to indicate a deficit)? d. What is the net capital flow (use a "-" to indicate an outflow)?