iven the following transactions between the domestic and foreign countries: I. Domestic business borrowed $35 from foreign banks II. Domestic investors sold $50 of their holdings of foreign government bonds III. Domestic investors bought $30 of foreign corporate bonds IV. Foreign investors purchased $45 of domestic government bonds What is Capital Account Balance?

iven the following transactions between the domestic and foreign countries: I. Domestic business borrowed $35 from foreign banks II. Domestic investors sold $50 of their holdings of foreign government bonds III. Domestic investors bought $30 of foreign corporate bonds IV. Foreign investors purchased $45 of domestic government bonds What is Capital Account Balance?

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter23: The International Trade And Capital Flows

Section: Chapter Questions

Problem 23RQ: What is included in the current account balance?

See similar textbooks

Similar questions

Under a system of flexible exchange rates, what will correct a deficit in a country's balance of payments? a. an appreciation in the nation's currency b. a decline in the nation’s domestic price level c. a depreciation in the nation's currency d. an increase in the nation’s inflation rate 2. Which of the following would supply Canadian dollars to the foreign exchange market? a. an increase in the number of Canadians going to Las Vegas over the holidays b. an increase in spending due to American tourists in Canada c. the sale of a Canadian corporation to a German investor d. the sale of wheat from Manitoba to a European bakery
43
If Canadian purchases of foreign real estate are $100 million, Canadian purchases of foreign- country bonds are $50 million, foreign purchases of Canadian real estate are $75 million and foreign purchases of Canadian bonds are $35 million, then the capital account balance is equal to million. a. - $10 b. - $40 C. + $40 d. - $90 e. + $90
Item Imports of goods and services Foreign investment in the United States Exports of goods and services U.S. investment abroad Net interest income Net transfers Statistical discrepancy a. Calculate the current account balance b. Calculate the capital and financial account balance. Billions of U.S. dollars 2,561 955 1,853 300 121 -123 66
Question: Exercise 1:4. Calculate the net capital flow. Does this country experience a net capital inflow or  outflow? Exercise 2:1.Calculate the net capital flow? Is this country experiencing a net capital inflow or outflow?  2.Calculate the country’s basic balance.
No hand written.. Only type
Description What accounts for differences in living standards between rich and poor countries today. Explain. Describe some differences in purchasing power parity of rich nations and poor countries today. Use actual examples of the purchasing power in comparison countries (rich and poor) to describe. Be specific.
Which of the following measures would best rectify a deficit on a country's Balance of Payments Account? a. Revaluing the currency b. Relaxing exchange controls c. Deflationary fiscal policy d. Lowering tariff barriers
The Current Account DOES NOT include: a. Portfolio Investment b. Net income investments in other countries c. Payments in connection with foreign trade. d. Interest on loans to other countries.
Exports of goods and services imports of goods and serviİces Net incurrence of financial assets Net acquisition of financial assets Secondary income receed Secondary income paid Investment income paid to foreigners Investment income received from foreigners 2550 1850 1365 1200 340 560 980 1200 Based on the above, the balance on the current account is how much?
5
Donald Company, a manufacturing company based in San Juan City, Philippines, purchased raw materials from a foreigncompany denominated in foreign currency. Which of the following is correct? A. If the foreign currency appreciates, Jonald will recognize foreign exchange loss.B. If the foreign currency appreciates, Jonald will recognize foreign exchange gain.C. If the foreign currency depreciates, Jonald will recognize foreign exchange loss. D. Any gain or loss will be deferred until the date of settlement.