Homerwork 3

D0106229

Table of Contents
Exports and imports.............................................................................................................. 1
Can imports or exports exceed GDP?................................................................................. 6
Nominal exchange rate ........................................................................................................ 8
Real exchange rate .............................................................................................................. 8
Uncovered interes parity relation ....................................................................................... 12
Exercise 8 ........................................................................................................................... 13

Exports and imports

• Enter into the World Bank’s Human Development Indicators database using the
link:
<https://databank.worldbank.org/source/world-development-indicators>
• In Country select Colombia
• In Series select GDP (constant LCU), Exports of goods and services (constant
LCU) and Imports of goods and services (constant LCU)
• In Time select VIEW RECENT YEARS: 50
• Apply changes and download the data using Download options > Excel at the
upper right corner of the platform
1. ̂ 𝑡 in the model expressed in
Calculate the net exports, exports minus imports (𝑁𝑋
real terms). (3.5 points)

Formula:
Exportaciones netas = exportaciones – importaciones
 Exports of goods and Imports of goods and Exportaciones netas
AÑO GDP (constant LCU) services (constant services (constant LCU) ̂𝒕
𝑵𝑿
LCU)
1970 $138,158,398,340,806.00 $11,609,035,797,470.70 $11,312,237,223,193.50 $296,798,574,277.20
1971 $146,393,644,598,281.00 $12,139,378,637,156.20 $13,590,859,486,231.70 -$1,451,480,849,075.50
1972 $157,620,789,204,195.00 $13,582,122,995,615.80 $11,804,872,357,997.30 $1,777,250,637,618.50
1973 $168,217,563,877,257.00 $14,608,259,474,303.50 $12,242,183,701,408.70 $2,366,075,772,894.80
1974 $177,882,936,646,683.00 $14,120,031,353,699.10 $13,466,275,375,844.10 $653,755,977,855.00
1975 $182,015,611,373,960.00 $16,159,190,745,851.60 $11,985,836,057,323.00 $4,173,354,688,528.60
1976 $190,621,980,628,253.00 $15,643,726,759,015.10 $13,463,952,621,243.60 $2,179,774,137,771.50
1977 $198,549,006,091,761.00 $14,939,881,364,073.60 $14,776,731,289,514.30 $163,150,074,559.30
1978 $215,365,910,023,838.00 $18,700,196,191,724.60 $17,838,333,012,412.10 $861,863,179,312.50
1979 $226,950,698,583,102.00 $20,262,223,556,922.80 $17,977,909,447,948.00 $2,284,314,108,974.80
1980 $236,226,976,297,753.00 $21,296,934,289,794.60 $21,349,282,170,741.80 -$52,347,880,947.20
1981 $241,605,563,942,918.00 $18,776,860,111,488.90 $22,394,521,740,942.80 -$3,617,661,629,453.89
1982 $243,897,001,332,472.00 $18,484,326,733,440.80 $24,178,819,593,104.10 -$5,694,492,859,663.30
1983 $247,735,832,912,147.00 $18,319,398,432,368.80 $21,984,872,293,227.60 -$3,665,473,860,858.80
1984 $256,036,677,181,166.00 $20,207,247,456,565.40 $21,114,472,796,587.50 -$907,225,340,022.11
1985 $263,992,008,635,957.00 $23,107,362,842,387.10 $19,717,441,484,173.40 $3,389,921,358,213.70
1986 $279,367,104,218,411.00 $27,891,796,677,153.00 $20,518,158,342,800.10 $7,373,638,334,352.90
1987 $294,366,134,488,110.00 $30,064,109,193,106.70 $21,614,498,514,211.00 $8,449,610,678,895.70
1988 $306,329,684,168,823.00 $30,139,512,193,138.10 $23,030,534,182,446.90 $7,108,978,010,691.20
1989 $316,788,073,995,614.00 $32,672,699,936,666.60 $22,380,374,053,831.00 $10,292,325,882,835.60
1990 $330,352,934,040,321.00 $38,420,980,815,311.70 $24,136,165,372,259.50 $14,284,815,443,052.20
1991 $336,965,303,464,300.00 $43,015,772,322,200.00 $24,961,587,893,500.00 $18,054,184,428,700.00
1992 $350,595,312,219,100.00 $45,418,580,965,400.00 $35,282,642,380,800.00 $10,135,938,584,600.00
1993 $369,476,307,007,500.00 $48,243,545,535,100.00 $48,361,862,376,400.00 -$118,316,841,300.00
1994 $390,960,105,089,700.00 $48,264,224,618,700.00 $60,090,506,151,600.00 -$11,826,281,532,900.00
1995 $411,299,560,568,600.00 $49,982,835,572,600.00 $64,453,654,153,900.00 -$14,470,818,581,300.00
1996 $419,755,281,965,700.00 $54,782,696,284,200.00 $65,930,081,279,000.00 -$11,147,384,994,800.00
1997 $434,154,120,867,200.00 $56,509,117,135,000.00 $70,013,387,453,500.00 -$13,504,270,318,500.00
1998 $436,627,861,973,400.00 $60,676,933,700,700.00 $67,273,705,717,600.00 -$6,596,772,016,900.00
1999 $418,271,960,097,800.00 $64,271,378,031,100.00 $50,670,124,490,100.00 $13,601,253,541,000.00
2000 $430,505,835,553,500.00 $68,221,784,981,500.00 $53,685,211,656,300.00 $14,536,573,325,200.00
2001 $437,729,285,682,800.00 $70,139,415,356,700.00 $58,377,375,991,600.00 $11,762,039,365,100.00
2002 $448,689,941,488,100.00 $68,471,910,682,600.00 $58,569,467,204,300.00 $9,902,443,478,300.01
2003 $466,270,833,399,700.00 $73,511,645,791,500.00 $63,354,618,368,600.00 $10,157,027,422,900.00
2004 $491,137,159,839,000.00 $80,722,114,663,800.00 $69,862,472,892,500.00 $10,859,641,771,300.00
2005 $514,252,805,347,500.00 $85,334,551,680,100.00 $78,177,453,194,800.00 $7,157,098,485,299.98
2006 $549,116,087,505,700.00 $93,308,527,946,500.00 $92,904,315,244,300.00 $404,212,702,200.00
2007 $586,723,152,705,500.00 $99,525,645,120,100.00 $105,445,596,502,300.00 -$5,919,951,382,199.98
2008 $605,833,010,146,800.00 $103,179,598,295,800.0 $118,163,292,743,600.00 -$14,983,694,447,800.00
0
2009 $613,135,855,112,900.00 $98,764,219,882,300.00 $107,944,796,899,300.00 -$9,180,577,016,999.98
2010 $639,792,263,022,100.00 $100,800,541,239,600.0 $119,634,711,154,400.00 -$18,834,169,914,800.00
0
2011 $686,897,166,175,500.00 $113,154,823,202,900.0 $145,949,084,012,400.00 -$32,794,260,809,500.00
0
2012 $713,707,135,002,000.00 $118,689,956,624,400.0 $159,629,437,946,000.00 -$40,939,481,321,600.00
0
2013 $746,301,210,416,700.00 $124,241,213,969,200.0 $171,440,100,816,800.00 -$47,198,886,847,600.00
0
2014 $781,588,661,940,700.00 $123,882,149,212,100.0 $184,747,909,967,800.00 -$60,865,760,755,700.00
0
2015 $804,692,000,000,000.00 $125,936,000,000,000.0 $182,750,000,000,000.00 -$56,814,000,000,000.00
0
2016 $821,489,000,000,000.00 $125,673,000,000,000.0 $176,279,000,000,000.00 -$50,606,000,000,000.00
0
2017 $832,590,000,000,000.00 $128,829,000,000,000.0 $178,390,000,000,000.00 -$49,561,000,000,000.00
0
2018 $853,981,077,024,600.00 $133,887,909,991,900.0 $192,534,497,610,600.00 -$58,646,587,618,700.00
0
2019 .. .. .. …

2. Maket a plot of GDP (constant LCU) (𝑌̂𝑡 in the model expressed in real terms),
Exports of goods and services (constant LCU) (𝑋̂𝑡 in the model expressed in real
terms) Imports of goods and services (constant LCU) (𝐼𝑀̂ 𝑡 ∗ 𝜀𝑡 in the model
̂
expressed in real terms) and net exports (𝑁𝑋𝑡 in the model expressed in real
terms). (3.5 points)
 PIB, Exportaciones, Importaciones y Exportaciones Netas
En Términos Reales
$1,000,000,000,000,000.00

$800,000,000,000,000.00

$600,000,000,000,000.00

$400,000,000,000,000.00

$200,000,000,000,000.00

$0.00

($200,000,000,000,000.00)

GDP (constant LCU) Exports of goods and services (constant LCU)

Imports of goods and services (constant LCU) Exportaciones netas

𝑋̂𝑡
3. Calculate the exports as a percentage of GDP, ∗ 100, the imports as a percentage of
𝑌̂𝑡
̂ 𝑡 ∗𝜀𝑡
𝐼𝑀 ̂𝑡
𝑁𝑋 𝑋̂𝑡−𝐼𝑀
̂ 𝑡∗𝜀𝑡
GDP, ∗ 100 and net exports as a percentage of GDP, ∗ 100 ≡ ∗ 100.
𝑌̂𝑡 𝑌̂𝑡 𝑌̂𝑡
(3.5 points)

8.19 % 8.40 % 0.21 %

9.28 % 8.29 % -0.99 %
7.49 % 8.62 % 1.13 %
7.28 % 8.68 % 1.41 %
7.57 % 7.94 % 0.37%
6.59 % 8.88 % 2.29 %
7.06 % 8.21 % 1.14 %
7.44 % 7.52 % 0.08 %
8.28 % 8.68 % 0.40 %
7.92 % 8.93 % 1.01 %
9.04 % 9.02 % -0.02 %
9.27 % 7.77 % -1.50 %
9.91 % 7.58 % -2.33 %
8.87 % 7.39 % -1.48 %
8.25 % 7.89 % -0.35 %
7.47 % 8.75 % 1.28 %
7.34 % 9.98 % 2.64 %
7.34 % 10.21 % 2.87 %
7.52 % 9.84 % 2.32 %
7.06 % 10.31 % 3.25 %
7.31 % 11.63 % 4.32 %
7.41 % 12.77 % 5.36 %
10.06 % 12.95 % 2.89 %
13.09 % 13.06 % -0.03 %
15.37 % 12.35 % -3.02 %
15.67 % 12.15 % -3.52 %
15.71 % 13.05 % -2.66 %
16.13 % 13.02 % -3.11 %
15.41 % 13.90 % -1.51 %
12.11 % 15.37 % 3.25 %
12.47 % 15.85 % 3.38 %
13.34 % 16.02 % 2.69 %
13.05 % 15.26 % 2.21 %
13.59 % 15.77 % 2.18 %
14.22 % 16.44 % 2.21 %
15.20 % 16.59 % 1.39 %
16.92 % 16.99 % 0.07 %
17.97 % 16.96 % -1.01 %
19.50 % 17.03 % -2.47 %
17.61 % 16.11 % -1.50 %
18.70 % 15.76 % -2.94 %
21.25 % 16.47 % -4.77 %
22.37 % 16.63 % -5.74 %
22.97 % 16.65 % -6.32 %
 23.64 % 15.85 % -7.79 %
22.71 % 15.65 % -7.06 %
21.46 % 15.30 % -6.16 %
21.43 % 15.47 % -5.95 %
22.55 % 15.68 % -6.87 %

𝑋̂𝑡
4. Maket a plot of exports as a percentage of GDP, ∗ 100, the imports as a
𝑌̂𝑡
̂ 𝑡 ∗𝜀𝑡
𝐼𝑀 ̂𝑡
𝑁𝑋
percentage of GDP, ∗ 100 and net exports as a percentage of GDP, ∗
𝑌̂𝑡 𝑌̂𝑡
𝑋̂𝑡−𝐼𝑀
̂ 𝑡∗𝜀𝑡
100 ≡ ∗ 100 where the x-axis corresponds to the date and y-axis
𝑌̂𝑡
corresponds to the values of these variables. (3.5 points)

The exports as a percentage of GDP, The imports as a

percentage of GDP and Net exports as a percentage of GDP
30.00%
25.00%
20.00%
15.00%
10.00%
5.00%
0.00%
-5.00% 1970197219741976197819801982198419861988199019921994199619982000200220042006200820102012201420162018
-10.00%

Las importaciones como porcentaje del PIB Las exportaciones como porcentaje del PIB
Las exportaciones netas como porcentaje del PIB

Can imports or exports exceed GDP?

5. Point out if it is possible that imports or exports can be greater than GDP. Then
explain why or why not imports can be greater than GDP supporting your answer
with an example or using elements from macroeconomic theory. (3.5 points)
Observation 1: Be clear and precise in the explanation and please don’t include
“bullshit” (Sorry for the last word but I did not find a better expression where I am using
it in the sense indicated in https://en.wikipedia.org/wiki/Bullshit).

Si es posible, ya que como lo dice el libro hay algunos países que incluyen
exportaciones e importaciones de bienes intermedios. Por lo cual al dividir las
exportaciones o importaciones de un país sobre el PIB pueden arrojar un resultado
 mayor a 1. Un ejemplo de esto es Singapur el cual es un país donde las manufacturas
desempeñan un papel importante tanto en sus importaciones como exportaciones,
confirmando lo dicho en el libro; se presenta la siguiente información en donde muestra
que las importaciones y exportaciones superan el PIB en Singapur desde el año 2009
hasta el 2018.

GDP (constant Exports of goods Imports of goods Exports/ Imports/

AÑO
LCU) and services and services GDP GDP

2009 $ 297.292.100.000 $508.713.200.000 $ 448.355.600.000 171,1% 150,8%

2010 $ 340.475.700.000 $599.201.400.000 $521.467.700.000 175,9% 153,1%

2011 $ 361.797.200.000 $645.282.900.000 $ 551.126.400.000 178,3% 152,3%

2012 $ 377.894.700.000 $ 654.298.500.000 $565.356.000.000 173,1% 149,6%

2013 $ 396.090.500.000 $694.471.400.000 $602.175.200.000 175,3% 152,0%

2014 $411.540.300.000 $719.611.000.000 $618.846.500.000 174,8% 150,3%

2015 $ 423.444.100.000 $755.359.100.000 $639.768.100.000 178,3% 151,0%

2016 $ 435.987.900.000 $755.726.900.000 $640.345.200.000 173,3% 146,8%

2017 $ 452.118.500.000 $799.082.600.000 $688.651.600.000 176,7% 152,3%

2018 $ 466.312.600.000 $ 840.223.900.000 $720.695.800.000 180,1% 154,5%

GDP, Exports, Imports

$900.000.000.000

$800.000.000.000

$700.000.000.000

$600.000.000.000

$500.000.000.000

$400.000.000.000

$300.000.000.000

$200.000.000.000
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
$100.000.000.000 AÑOS

$-
GDP (constant LCU) Exports of goods and services (constant LCU)

Imports of goods and services(constant LCU)

 Nominal exchange rate
• Enter into the Bank of the Republic (Colombia) using the route:
http://www.banrep.gov.co/ > Estadísticas > Tasas de cambio y sector financiero > 1.
Tasas de cambio > Tasa Representativa del Mercado (TRM - Peso por dólar) >
DESCARGAR: Serie histórica > Seleccione una vista: TRM - Vista histórica - Tabla >
Exportar > Excel 2007 +
6. Make a plot of Tasa Representativa del Mercado (TRM - Peso por dólar) where the
x-axis corresponds to the date and y-axis corresponds to the value of this variable.
(3.5 points)

TRM (COP/USD)
$ 4,500.00

$ 4,000.00

$ 3,500.00

$ 3,000.00

$ 2,500.00

$ 2,000.00

$ 1,500.00

$ 1,000.00

$ 500.00

$ 0.00
27/11/1991

27/11/1998
27/11/1999

27/11/2000
27/11/2001
27/11/2002
27/11/2003
27/11/2004
27/11/2005
27/11/2006
27/11/2007

27/11/2008
27/11/2009
27/11/2010
27/11/2011
27/11/2012
27/11/2013
27/11/2014
27/11/2015
27/11/2016
27/11/2017
27/11/2018
27/11/2019
27/11/1992
27/11/1993
27/11/1994
27/11/1995
27/11/1996
27/11/1997

Real exchange rate

7. Assume that you want to calculate the real exchange rate for Colombia with
reference to the USA and where only one product, the Big Mac hamburger, is
taken into account. Calculate the real exchange rate for the dates in the table below
 using information of this table1, and data from point 5 about the Tasa
Representativa del Mercado (TRM - Peso por dólar) in those dates (3.5 points):
Date Price Big Mac Colombia Price Big Mac USA
2004-05-01 6500 2.90

2005-06-01 6500 3.06

2006-05-01 6500 3.10

2007-01-01 6900 3.22

2007-06-01 6900 3.41

2008-06-01 7000 3.57

2009-07-01 7000 3.57

2010-01-01 8200 3.58

2010-07-01 8200 3.73

2011-07-01 8400 4.07

2012-01-01 8400 4.20

2012-07-01 8600 4.33

2013-01-01 8600 4.37

2013-07-01 8600 4.56

2014-01-01 8600 4.62

2014-07-01 8600 4.80

2015-01-01 7900 4.79

2015-07-01 7900 4.79

2016-01-01 7900 4.93

2016-07-01 8900 5.04

2017-01-01 9900 5.06

2017-07-01 9900 5.30

1 The data of the table was taken from https://github.com/TheEconomist/big-mac-data

 2018-01-01 10900 5.28

2018-07-01 11900 5.51

2019-01-01 11900 5.58

El tipo de cambio real es el precio relativo de los bienes entre diferentes países. Se
define usualmente como la relación entre el poder de compra de una divisa en relación
a otra divisa. El poder de compra de una divisa es la cantidad de bienes que pueden
ser comprados con una unidad de esa divisa.

Formula:

Tipo de cambio real = EP*/P

E: tipo de cambio nominal. (cantidad de unidades de moneda extranjera que podemos

obtener, con una unidad de moneda local).
P*: nivel de precios que refleja el poder de compra de la moneda extranjera.
P: nivel de precios que refleja el poder de compra de la moneda local.

Price Big Price

Date Mac Big Mac TCN (E) TCR = EP/P*
Colombia USA
5/1/2004 6500 2.9 2655.18 1.184618769
6/1/2005 6500 3.06 2338.89 1.101077446
5/1/2006 6500 3.1 2375.03 1.132706615
1/1/2007 6900 3.22 2238.79 1.044768667
6/1/2007 6900 3.41 1900.09 0.939029986
6/1/2008 7000 3.57 1744.01 0.8894451
7/1/2009 7000 3.57 2145.21 1.0940571
1/1/2010 8200 3.58 2044.23 0.892480902
7/1/2010 8200 3.73 1971.55 0.896814817
7/1/2011 8400 4.07 1772.32 0.858731238
1/1/2012 8400 4.2 1942.7 0.97135
7/1/2012 8600 4.33 1784.6 0.898525349
1/1/2013 8600 4.37 1768.23 0.89850757
7/1/2013 8600 4.56 1929 1.022818605
1/1/2014 8600 4.62 1926.83 1.035111
 7/1/2014 8600 4.8 1881.19 1.049966512
1/1/2015 7900 4.79 2392.46 1.450618152
7/1/2015 7900 4.79 2598.68 1.575655342
1/1/2016 7900 4.93 3149.47 1.965428747
7/1/2016 8900 5.04 2919.01 1.653012404
1/1/2017 9900 5.06 3000.71 1.533696222
7/1/2017 9900 5.3 3050.43 1.633058485
1/1/2018 10900 5.28 2984 1.44546055
7/1/2018 11900 5.51 2930.8 1.523832353
1/1/2019 11900 5.58 3207.66 1.547224235

8. Maket a plot of the real exchange rate using the information you found in point 6
where the x-axis corresponds to the dates of the table above and y-axis
corresponds to the value of the real exchange rate. (3.5 points)
2,5

1,5

0,5

Series1 Series2 Series3 TCR = e (P*/P)

Uncovered interes parity relation
• In the book Oliver Blanchard (2017) Macroeconomics (7 Edition) the
𝐸
uncovered interes parity relation is define as (1 + 𝑖𝑡 ) = (1 + 𝑖𝑡∗ ) 𝑒𝑡
𝐸𝑡+1
9. Describe what this expression refers to and what it represents. (3.5 points)
Observation 1: Be clear and precise in the explanation and please don’t include
“bullshit” (Sorry for the last word but I did not find a better expression where I am using
it in the sense indicated in https://en.wikipedia.org/wiki/Bullshit).
La relación de equivalencia descubierta de los tipos de interés o también llamada
condición de paridad de los tipos de utilidad se refiere a una posición de juicio sin
riesgos.
Figura la relación entre el tipo de interés nominal nacional, el tipo de interés nominal
extranjero y la tasa esperada de apreciación de la moneda nacional. El arbitraje de los
inversores implica que el tipo de interés nacional debe ser igual al tipo de interés
extranjero menos la tasa esperada de apreciación de la moneda nacional.

10. In Colombia, the nominal exchange rate between pesos and US dollars is
𝑝𝑒𝑠𝑜𝑠
expressed as . What modifications would have to be made to the condition
1 𝑑𝑜𝑙𝑙𝑎𝑟
pointed out in point 9 if someone want to write the uncovered interes parity
relation for a resident in Colombia who has to decide to invest between financial
products of Colombia and the USA? (3.5 points)

𝑖𝑡 = 𝑖𝑡∗ − 𝐸𝑡+1
𝑒
− 𝐸𝑡 / 𝐸𝑡

El arbitraje de los inversionistas implica que el tipo de interés nacional debe ser igual al
tipo de interés extranjero menos la tasa esperada de apreciación de la moneda
nacional. Como primera medida se debe ver cuál es la tasa de interés, ya que si se
invierte en dólares o en pesos deben ofrecer la misma rentabilidad para que las
inversiones estén libres de riesgo.

La teoría de la paridad en tipos de interés dice que el diferencial de tipos de interés

debe igualar la diferencia entre los tipos de interés a plazo y al contado.
Adicionalmente, la teoría de la paridad de los tipos de interés se mantiene cuando la
tasa de retorno de depósitos en dólares es exactamente igual a la tasa esperada de
retorno en depósito en pesos.
Exercise 8
This exercises is taken from:
Oliver Blanchard (2017) Macroeconomics (7 Edition) > Chapter 18 The Goods
Market in an Open Economy > Questions and Problems > Exercise 8
• Consider an open economy in which the real exchange rate is fixed and equal to
one. Consumption, investment, government spending, and taxes are given by:
𝐶̂𝑡 = 10 + 0.8(𝑌̂𝑡 − 𝑇̂𝑡 )
𝐼̂𝑡 = 10
𝐺̂𝑡 = 10

𝑇̂𝑡 = 10
• Imports and exports are given by:
̂ 𝑡 = 0.3𝑌̂𝑡
𝐼𝑀
𝑋̂𝑡 = 0.3𝑌̂𝑡∗
where 𝑌̂𝑡∗ denotes foreign output.
11. Solve for equilibrium output, 𝑌̂𝑡 and point out the multiplier for the domestic
economy. (3.5 points)

𝑌̂𝑡 = 𝐶̂𝑡 (Y -𝑇̂𝑡 ) + 𝐼̂𝑡 +𝐺̂𝑡 - 𝐼𝑀

̂ 𝑡 + 𝑋̂𝑡
𝑌̂𝑡 = 10 + 0.8 ( 𝑌̂𝑡 − 10) + 10 + 10 − 0.3𝑌̂𝑡 + 0.3𝑌̂𝑡 *
𝑌̂𝑡 = 10 + 0.8𝑌̂𝑡 − 8 + 10 + 10 − 0.3𝑌̂𝑡 + 0.3𝑌̂𝑡 *
𝑌̂𝑡 = 22 + 0.5𝑌̂𝑡 − 0.3𝑌̂𝑡 *
𝑌̂𝑡 − 0.5𝑌̂𝑡 = 22 + 0.3𝑌̂𝑡 *
0.5𝑌̂𝑡 = 22 + 0.3𝑌̂𝑡 *
22 + 0.3𝑌̂𝑡 ∗
𝑌̂𝑡 =
0.5

La producción de equilibrio nacional es:

22 + 0.3𝑌̂𝑡 ∗
𝑌̂𝑡 =
0.5

Y el multiplicador de para la economía nacional sin tener en cuenta aun lo que sucede
en el extranjero es:

1
𝑀= =2
0.5
12. Assume that the foreign economy is characterized by the same equations as the
domestic economy (with asterisks reversed). (3.5 points)

𝐶̂𝑡∗ = 10 + 0.8(𝑌̂𝑡∗ − 𝑇̂𝑡∗ )

𝐼̂𝑡∗ = 10
𝐺̂𝑡∗ = 10

𝑇̂𝑡∗ = 10
̂ 𝑡∗ = 0.3𝑌̂𝑡∗
𝐼𝑀
𝑋̂𝑡∗ = 0.3𝑌̂𝑡
Solve for the equilibrium output of each economy and point out the multiplier for the
domestic and the foreign economy.
𝑌̂𝑡 = 𝐶̂𝑡 (Y -𝑇̂𝑡 ) + 𝐼̂𝑡 +𝐺̂𝑡 - 𝐼𝑀
̂ 𝑡 + 𝑋̂𝑡
𝑌̂𝑡 = 10 + 0.8 ( 𝑌̂𝑡 − 10) + 10 + 10 − 0.3𝑌̂𝑡 + 0.3𝑌̂𝑡 *
𝑌̂𝑡 = 10 + 0.8𝑌̂𝑡 − 8 + 10 + 10 − 0.3𝑌̂𝑡 + 0.3𝑌̂𝑡 *
𝑌̂𝑡 = 22 + 0.5𝑌̂𝑡 − 0.3𝑌̂𝑡 *
𝑌̂𝑡 − 0.5𝑌̂𝑡 = 22 + 0.3𝑌̂𝑡 *
0.5𝑌̂𝑡 = 22 + 0.3𝑌̂𝑡 *
22 + 0.3𝑌̂𝑡 ∗
𝑌̂𝑡 =
0.5
La producción de equilibrio del otro país es:
22 + 0.3𝑌̂𝑡 ∗
𝑌̂𝑡 =
0.5
Y el multiplicador de para la economía extranjera inicialmente sería:
1
𝑀 ∗= =2
0.5

Producción de equilibrio:
Primero se dejan en términos de 𝑌̂𝑡
22 + 0.3𝑌̂𝑡 ∗
𝑌̂𝑡 ∗=
0.5
𝑌𝑡 ∗ (0.5) = 22 + 0.3𝑌̂𝑡
̂
𝑌̂𝑡 ∗ (0.5) − 22
= 𝑌̂𝑡
0.3
Se igualan las dos ecuaciones
22 + 0.3𝑌̂𝑡 ∗ 𝑌̂𝑡 ∗ (0.5) − 22
=
0.5 0.3
(22 + 0.3𝑌̂𝑡 ∗)(0.3) = (𝑌̂𝑡 ∗ (0.5) − 22)(0.5)
6.6 + 0.09 𝑌̂𝑡 ∗ = 0.25𝑌̂𝑡 ∗ −11
6.6 + 11 = −0.09𝑌̂𝑡 ∗ +0.25𝑌̂𝑡 ∗
17.6 = 0.16𝑌̂𝑡 ∗
17.6
= 𝑌̂𝑡 ∗
0.16
110 = 𝑌̂𝑡 ∗
22 + 0.3(110)
𝑌̂𝑡 ∗=
0.5
𝑌̂𝑡 ∗= 110

La producción de equilibrio para el país B(extranjero) es 𝑌̂𝑡 ∗=110 y la producción de

equilibrio nacional es 𝑌̂𝑡 ∗=110.
Para el multiplicador:
𝑌̂𝑡 = 22 + 0.5𝑌̂𝑡 − 0.3𝑌̂𝑡 *
Y con
22 + 0.3(110)
𝑌̂𝑡 ∗= = 44 + 0.6𝑌̂𝑡 ∗
0.5
𝑌̂𝑡 = 22 + 0.5𝑌̂𝑡 + 0.3 ∗ (44 + 0.6𝑌̂𝑡 )
𝑌̂𝑡 = 22 + 0.5𝑌̂𝑡 + 13.2 + 0.18𝑌̂𝑡
𝑌̂𝑡 − 05𝑌̂𝑡 − 0.18𝑌̂𝑡 = 22 + 13.2
0.32𝑌̂𝑡 = 35.2
35.2
𝑌̂𝑡 = = 110
0.32

Así el multiplicador de la economía nacional sería:

1
𝑀= = 3.125
0.32

Del mismo modo el multiplicador del país extranjero sería:

1
𝑀 ∗= = 3.125
0.32
13. Assume that the domestic government has a target level of output of 125.
Assuming that the foreign government does not change 𝐺̂𝑡∗, what is the increase in
𝐺̂𝑡 necessary to achieve the target output in the domestic economy? Also solve for
net exports, 𝑁𝑋 ̂ 𝑡 ≡ 𝑋̂𝑡 − 𝐼𝑀
̂ 𝑡 and 𝑁𝑋
̂ 𝑡∗ ≡ 𝑋̂𝑡∗ − 𝐼𝑀
̂ 𝑡∗, and the budget deficit, 𝑇̂𝑡 − 𝐺̂𝑡
and 𝑇̂𝑡∗ − 𝐺̂𝑡∗ , in each country. (3.5 points)

Con un nivel de producción de 125 para la economía interna el gasto debe ser:

𝑌̂𝑡 = 𝐶̂𝑡 (𝑌̂𝑡 − 𝐼𝑀

̂ 𝑡 − 𝑇̂𝑡 ) + 𝑌̂𝑡 − 𝐺̂𝑡 − 𝐼𝑀̂ 𝑡 + 𝑋̂𝑡 *
𝑌̂𝑡 = 𝐶̂𝑡 (𝑌̂𝑡 − 𝑇̂𝑡 ) + 𝐼̂𝑡 + 𝐺̂𝑡 − 0.3𝑌̂𝑡 + 0.3𝑌̂𝑡 *
Con
22 + 0.3𝑌̂𝑡 ∗ 22 + 0.3 ∗ (125)
𝑌̂𝑡 = = = 119
0.5 0.5
125 = 10 + 0.8(125 − 10) + 10 + 𝐺̂𝑡 − 0.3(125) + 0.3(119)
125 = 10 + 92 + 10 + 𝐺̂𝑡 − 37.5 + 35.7
125 = 110.2 + 𝐺̂𝑡
125 − 110.2 = 𝐺̂𝑡
14.8 = 𝐺̂𝑡

Para un aumento en la producción a 125 el aumento en el gasto tiene que ser de 7.5:
↑𝐺̂2𝑡 − 𝐺̂1𝑡 =𝛥 𝐺̂𝑡
14.8 − 10 = 4.8
Exportaciones netas nacional
̂ 𝑡∗ ≡ 𝑋̂𝑡∗ − 𝐼𝑀
𝑁𝑋 ̂ 𝑡∗
̂ 𝑡∗ ≡ 0.3𝑌̂𝑡∗ − 0.3𝑌̂𝑡
𝑁𝑋
̂ 𝑡∗ ≡ 0.3(119) − 0.3(125) = 35.7 − 37.5
𝑁𝑋
̂ 𝑡∗ = −1.8
𝑁𝑋
Déficit presupuestario nacional

𝑇̂𝑡 − 𝐺̂𝑡 = 10 − 14.8 = −4.8

Exportaciones netas extranjero

̂ 𝑡∗ ≡ 𝑋̂𝑡∗ − 𝐼𝑀
𝑁𝑋 ̂ 𝑡∗
̂ 𝑡∗ ≡ 0.3𝑌̂𝑡∗ − 0.3𝑌̂𝑡
𝑁𝑋
̂ 𝑡∗ ≡ 0.3(125) − 0.3(119) = 35.7 − 37.5
𝑁𝑋
̂ 𝑡∗ = 1.8
𝑁𝑋
Déficit presupuestario extranjero

𝑇̂𝑡 *- 𝐺̂𝑡 * =10 – 10 = 0

14. Suppose each government has a target level of output of 125 and that each
government increases government spending by the same amount. What is the
common increase in 𝐺̂𝑡 and 𝐺̂𝑡∗ necessary to achieve the target output in both
countries? Also solve for net exports, 𝑁𝑋 ̂ 𝑡 ≡ 𝑋̂𝑡 − 𝐼𝑀
̂ 𝑡 and 𝑁𝑋̂ 𝑡∗ ≡ 𝑋̂𝑡∗ − 𝐼𝑀
̂ 𝑡∗, and the
budget deficit, 𝑇̂𝑡 − 𝐺̂𝑡 and 𝑇̂𝑡 − 𝐺̂𝑡 , in each country for this new situation. (4.5
∗ ∗

points)
Para el país A (nacional)
Gasto para la producción 125

𝑌̂𝑡 = 𝐶̂𝑡 (Y -𝑇̂𝑡 ) + 𝐼̂𝑡 +𝐺̂𝑡 - 𝐼𝑀

̂ 𝑡 + 𝑋̂𝑡
125 = 10 + 0.8(125 − 10) + 10 + 𝐺̂𝑡 − 0.3(125) + 0.3(125)
125 = 112 + 𝐺̂𝑡
125 − 112 = 𝐺̂𝑡
13 = 𝐺̂𝑡

Para un aumento en la producción a 125 el aumento en el gasto tiene que ser de 3

↑𝐺̂2𝑡 − 𝐺̂1𝑡 =𝛥 𝐺̂𝑡+

3 − 10 = 3

Exportaciones netas nacional.

̂ = 𝑋̂𝑡 − 𝐼𝑀
𝑁𝑋 ̂𝑡
̂ = 0.3(125) − 0.3(125)
𝑁𝑋
̂ =0
𝑁𝑋
Déficit presupuestario nacional

𝑇̂𝑡 − 𝐺̂𝑡 = 10 − 13 = −3
Para el país B (extranjero)
Gasto para la producción 125

𝑌̂𝑡 = 𝐶̂𝑡 (𝑌̂𝑡∗ -𝑇̂𝑡∗ )+ 𝐼̂𝑡∗ +𝐺̂𝑡∗ - 𝐼𝑀

̂ 𝑡∗ + 𝑋̂𝑡∗
125 = 10 + 0.8(125 − 10) + 10 + 𝐺̂𝑡∗ − 0.3(125) + 0.3(125)
125 = 112 + 𝐺̂𝑡∗
125 − 112 = 𝐺̂𝑡∗
13 = 𝐺̂𝑡∗

Para un aumento en la producción a 125 en el extranjero el aumento en el gasto tiene

que ser de 3

↑𝐺̂2𝑡
∗
-𝐺̂1𝑡
∗
= 𝛥 𝐺̂𝑡
3 − 10 = 3
Exportaciones netas extranjero
̂ ∗ = 𝑋̂ ∗ − 𝐼𝑀
𝑁𝑋 ̂ 𝑡,𝑦
∗

̂ ∗ = 0.3 (125) − 0.3(125)

𝑁𝑋
̂ ∗= 0
𝑁𝑋

Déficit presupuestario extranjero

𝑇̂𝑡∗ − 𝐺̂𝑡∗ = 10 − 13 = −3

Bibliografia
https://databank.worldbank.org/source/world-development-indicators#
https://datacatalog.worldbank.org/public-licenses#cc-by
https://github.com/TheEconomist/big-mac-data
http://www.banrep.gov.co/
Material de apoyo