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Q46. An appreciation of the U. S. dollar would
a. encourage foreigners to invest in the United States
b. discourage foreigners from buying U. S. goods
c. discourage the travel abroad of U. S. citizens
d. encourage foreign travel in the United States

Q47. The financial account of the balance of payments includes the purchase and sale of physical assets but not of financial assets.
a. true
b. false

Q48. Special Drawing Rights are issued by the
a. International Monetary Fund
b. Bretton Woods Organization
c. General Agreement on Tariffs and Trade
d. World Bank

Q49. The balance of payments includes
a. only exports, imports, and service transactions
b. the balance on current account, plus all capital transactions and all official transactions and the statistical discrepancy
c. only the official transactions
d. all goods and services produced in a nation's economy during a given year

Q50. A debit item on the U. S. balance of payments is any transaction that
a. results in a loss by U. S. sellers
b. results in a loss by U. S. buyers
c. makes foreigners use up their holdings of U. S. dollars
d. makes U. S. dollars available to foreigners

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Beverley Smith
Beverley SmithLv2
4 Sep 2018

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Related questions

Q44. Paying off the national debt would redistribute income from the
a. debt holders to the taxpayers
b. taxpayers to the major recipients of transfer payments
c. banks to the taxpayers
d. taxpayers to the debt holders

Q45. When the government uses tax revenue to pay off portions of the national debt, total purchasing power in the economy
a. increases
b. decreases
c. is not affected at any level
d. remains the same but changes individually

Q46. Which of the following would cause a credit to the U. S. balance of payments?
a. a group of U. S. citizens goes to New Zealand for a vacation
b. General Motors pays a dividend to a citizen of Brazil
c. Lloyd's of London makes an insurance payment to a U. S. resident
d. Russia cancels its purchases of U. S. wheat and buys wheat from Argentina

Q47. Under the gold standard, a country experiencing a gold outflow
a. has a balance of payments surplus
b. had an increasing money supply
c. experienced a decline in output
d. experienced an increase in output

Q48. Under the gold standard, a country with a trade deficit should expect
a. gold to flow out of the country to other countries
b. gold to flow into the country from other countries
c. the value of its currency to appreciate
d. the value of its currency to depreciate

Q49. The course of international monetary policy is directed primarily by the
a. Federal Reserve
b. World Bank
c. International Monetary Fund
d. leaders of the Group of Seven nations

Shown below is a simplified balance of payments table for the United States. Use the information in the table to answer the questions below.

Amount

(in billions of dollars)

1. Exports of goods and services 1,500

2. Income receipts 600

3. Imports of goods and services -2,000

4. Income payments -800

5. Unilateral current transfers 0

6. U.S.-owned assets abroad?

7. Foreign-owned assets in the United States 1,100

8. Statistical discrepancy 0

Questions:

a. What is the value for the missing entry?

b. If U.S. GDP is $13,000 billion, what must U.S. GNI be?

c. What is U.S. GNE (i.e., C + I +G)?

d. If U.S. gross domestic investment (I) is $3,100 billion, what must U.S. gross national saving (S) be?

5-

In the short run, a tighter monetary policy by the U.S. Federal Reserve leads to:

Select one:

a. an increase in the supply of dollars and a dollar depreciation.

b. a decrease in the supply of dollars and a dollar appreciation.

c. an increase in the demand for dollars and a dollar depreciation.

d. a decrease in the demand for dollars and a dollar appreciation.

6-

Which theorem states that exchange rates will adjust until the prices of goods in different countries approximate one another?

Select one:

a. purchasing power parity

b. the law of multiple prices

c. the principle of comparative advantage

d. dollarization

7-

A country's balance of trade is the difference between its:

Select one:

a. nominal and real exchange rates.

b. monetary and fiscal policy.

c. exports and imports.

d. capital inflow and capital outflow.

8-

When a foreign business buys stock in a U.S. company, the U.S. capital account will:

Select one:

a. move in a positive direction.

b. move in a negative direction.

c. remain unchanged.

d. become more volatile.

9-

Saying that the United States is running a large current account deficit is equivalent to saying that:

Select one:

a. exports exceed imports in the United States.

b. the United States is running a large capital account surplus.

c. the balance of payments is negative.

d. the value of the current capital stock in the United States exceeds the value of future capital flows.

10-

An increase in the demand for a country's exports will have what effect on its currency?

Select one:

a. Its value will not change.

b. Its value will increase.

c. Its value will decrease.

d. Its value will depreciate.

11-

When the United States has a current account deficit, the U.S. capital account:

Select one:

a. will have a deficit also.

b. will be balanced.

c. will have a surplus.

d. must be falling.

12-

Which of the following is NOT a way that a country can finance a trade deficit?

Select one:

a. increased borrowing

b. sale of assets

c. decreased exports

d. reduction in cash reserves

13-

A trade deficit occurs when the value of a country's:

Select one:

a. imports exceeds the value of its exports.

b. exports exceeds the value of its imports.

c. inflow of foreign capital exceeds the outflow of domestic capital.

d. outflow of domestic capital exceeds its inflow of foreign capital.

14-

Which of the following is a U.S. current account transaction?

Select one:

a. Selling a computer chip to a resident in Europe.

b. Buying stock shares of a Canadian company.

c. Selling U.S. dollars in exchange for euros.

d. A foreign investor's purchase of a manufacturing plant in the United States.

15-

An exchange rate is:

Select one:

a. a yearly summary of all the economic transactions between residents of one country and residents of the rest of the world.

b. the sum of the balance of trade, net income on capital held abroad, and net transfer payments.

c. the price of one currency in terms of another currency.

d. a currency whose value is not pegged but governments will intervene extensively in the market to keep the value within a certain range.

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