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Please Answer the following two questions: Use the following information to answer the questions below. Assume that the capital account is equal to...
Please Answer the following two questions:1. Use the following information to answer the questions below. Assume that the capital account is equal to zero.Net unilateral transfers 150Exports of goods and services 7500Net increase in United States government’s non-reserve foreign assets -130Net increase in foreign ownership of United States based non-reserve assets 550Net increase in U.S. private assets abroad 1250Invest income received in the U.S. 510Net increase in U.S. ownership of official reserve assets 110Imports of goods and services 6500Net increase in foreign ownership of U.S.-based reserve assets 100Investment income paid abroad by the U.S. 800(a) What is the current account balance?(b) What is the capital account balance?(c) What is the financial account balance?(b) Does the capital account equal the current account?(c) What is the statistical discrepancy?Please show your work2)Draw a graph of the supply of and demand for the Canadian dollar by the U.S. market. Diagram the effect of each of the following on exchange rates, state in words whether the effect is long, medium,or short run, and explain your reasoning.(f) Big budget deficits in EU and CAD in US.(a) More rapid growth in EU than in the United States.(b) A rise in U.S. interest rates.(c) Goods are more expensive in EUe than in the United States.(d) A recession in the EU.(e) Expectations of a future depreciation in the euro.