In 2007 the country of Ikonomia has a current account deficit of $1 billion and a non reserve financial account surplus of $750 million. Ikonomias capital account is in $100 million surplus. In addition, Ikonomian factors located foreign countries earn $700 million. Ikonomia has a trade deficit of $800 million. Assume Ikonomia neither gives nor receives unilateral transfers. Ikonomia's GDP is $9 million.
a) What happened to Ikonomia&acir's net foreign assets during 2007? Did it acquire or lose foreign assets during the year?
b) Compute the official settlements balance. Based on this number, what happened to the central banks (foreign) reserves.
c) How much income did foreign factors of production earn in Ikonomia during 2007?
d) Compute net factor income from abroad
e) Using the identity BOP =CA+FA+KA, show that BOP=0
f) Compute Ikonomia's gross national expenditure, gross national income, and gross national disposable income.