Please refer back to the week 2 essay assignment on the recent US federal level budget deficit policies, and present your responses to the following questions.

Now assume open economy (i.e, Y=C+I+G+NX, where NX is not artificially set equal to zero any more)

1) Analyze the effects of Biden administration’s expansive budget deficit policy on the U.S. loanable funds market and foreign exchange market following the logics covered in textbook.

2) What do you expect the impact of the policy on the U.S. economy to be in the long run from the perspectives of consumption, investment, net government spending, and export/import? Please discuss in each of listed perspectives. For question 2), you do not necessarily have to follow the textbook logics to arrive at your conclusions as long as your logic makes sense.

Why Joe Biden isn’t afraid of debt any more.pdf
How some American states’ finances have survived the pandemic.pdf