Suppose the average current account deficit (CAD) of a country is 4 percent. The gap is filled through foreign borrowing. The social and political instability stopped borrowing from foreign sources....

Suppose the average current account deficit (CAD) of a country is 4 percent. The gap is filled through foreign borrowing. The social and political instability stopped borrowing from foreign sources. How should the government adjust its savings and investments to keep the CAD at zero? What would happen to the aggregate demand and output of the economy?