Assume the following to be a portion of the simplified balance of payments statement for a hypothetical country. The values are given in billions of dollars. $400 $300 -$100 $60 Exports Imports Capital Outflows Capital Inflows If the central bank has not changed its holding of foreign-currency reserves during this period, then the capital-service account for this country should be equal to 5 billion

Assume the following to be a portion of the simplified balance of payments statement for a hypothetical country. The values are given in billions of dollars. $400 $300 -$100 $60 Exports Imports Capital Outflows Capital Inflows If the central bank has not changed its holding of foreign-currency reserves during this period, then the capital-service account for this country should be equal to 5 billion

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Similar questions

This is not a writing assignment, this is a multiple-choice question Which of the below statements about international exchange rates and PPPs (Purchasing Power Parity) would you consider to be INCORRECT? Group of answer choices The PPP only focuses on internationally tradable items, while the exchange rate has a broader focus and includes both internationally tradable and items that are not internationally tradable. Exchange rates include only the values of internationally tradable items, while the PPP includes both internationally tradable items as well as those which are not internationally tradable items but are used by people in different countries. The rate at which one currency can be exchanged for another is the exchange rate. If $25 can purchase a bundle of goods in the U.S. and if a comparable bundle of goods will cost 750 rubles in Russia, then the PPP between the U.S. dollar and the Russian ruble would be $25=750 Russian rubles.
When Country A’s currency becomes less valuable relative to Country B’s currency, we say that Country A’s currency has __________ relative to Country B’s currency. a) depreciated b) stagnated c) shifted d) appreciated
A country has been experiencing a persistent deficit in its current account balance due to high levels of imports compared to exports, along with significant outflows of income payments and transfers. To address this issue, the government is considering implementing a range of policies, including devaluation of the currency, imposition of tariffs, and promotion of export industries. The goal is to correct the balance of payments imbalance and improve the country's international financial position. The question is: In this scenario, the primary objective of the government's policies is to: A) Increase the country's reliance on imports B) Decrease foreign investment in the country C) Correct the balance of payments deficit D) Eliminate all forms of international trade
If the U.S. dollar depreciates 20 percent, how does this affect the export and domestic sales of a U.S. manufacturer? Explain.
Balance of payments accounting. For the following international transactions, identify the balance of payments accounts and whether the transaction would generate an inflow or an outflow of foreign exchange for the two countries involved. ■ TIAA-CREF—the pension fund of American college professors—purchases 1 million shares of South Africa’s Standard Bank for $16 million. ■ Air France purchases $2.5 million of jet fuel at Boston’s Logan Airport. Payment is made directly from Air France’s bank account with State Street in Boston. ■ Hong Kong–based Cathay Pacific pays a $25 million annual lease on two Boeing 777s to U.S.-based lessor GE Capital.
Uncovered interest parity condition (UIP) says that the expected rate of depreciation of the one country’s currency in terms of another country’s currency exchange rate is equal to
An increase in capital inflows in the United States will result in a(n) foreign currency and a(n) U.S. dollars in the foreign exchange market. increase in the demand for; increase in the supply of increase in the supply of; increase in the demand for shortage of foreign currency; surplus of decrease in the supply of; decrease in the demand for
A higher level of GDI relative to the country's absorption level contributes to a higher current account. True or False?
The dollar appreciated by 25% relative to the yen and the direct exchange rate is now 0.01 in the US. Find the old exchange rate prior to the dollar appreciation.
Explain how exchange rates may impact the performance of international equity investment.
which of the following cause a depreciation of domestic currency in the long run? (There are more than one answer) An increase in domestic price level An increase in productivity An increase in imports demand An increase in tariff An increase in export demand
Typed