In an open economy, the current account balance equals ________. (Assume that the capital account is zero and net transfers are zero.)

Using the data in the above table, if potential GDP for this economy is $25 billion, then at the present moment real GDP is

A) less than potential GDP. B) equal to potential GDP. C) greater than potential GDP. D) at the full-employment level of output. E) not comparable to potential GDP.

In the classical model, what happens to the level of real GDP if aggregate demand increases?

A) Real GDP increases. B) Real GDP decreases. C) Real GDP would increase at first, then decrease. D) Real GDP would remain the same, at equilibrium.