**Scenario Analysis: U.S. Toy Store Transaction with Japan**Suppose you own a toy store in the United States, where there is high demand for the PlayNation 3, a video game console. Because of this, you spend $15,000 to increase your inventory of the gaming system, which is manufactured by Zony, a Japanese company, in Japan.**Objective:**Determine the effects of this transaction on exports, imports, and net exports in the U.S. economy, and enter your results in the following table. If the direction of change is "No change," enter "0" in the Magnitude of Change column.**Hint:** The magnitude of change should always be positive, regardless of the direction of change.| **Direction of Change** | **Magnitude of Change (Dollars)** ||--------------------------|-----------------------------------|| Exports | || Imports | || Net Exports | |Because of the identity equation that relates to net exports, the _______ in U.S. net exports is matched by _________ in U.S. net capital outflow. Which of the following is an example of how the United States might be affected in this scenario? *Check all that apply.*- [ ] Zony exchanges the $15,000 for yen at the local bank, which then uses the dollars to purchase U.S. bonds.- [ ] Zony purchases $15,000 worth of U.S. bonds.- [ ] Zony purchases $15,000 worth of stock in a U.S. company.**Note:** In this scenario:- **Imports** increase by $15,000 due to the purchase from Japan.- **Net Exports** decrease as imports exceed exports, causing a potential change in the U.S. net capital flow.

Suppose you own a toy store in the United States, where there is high demand for the PlayNation 3, a video game console. Because of this, you spene $15,000 to increase your inventory of the gaming system, which is manufactured by Zony, a Japanese company, in Japan. Determine the effects of this transaction on exports, imports, and net exports in the U.S. economy, and enter your results in the following table. If the direction of change is "No change," enter "0" in the Magnitude of Change column. Hint: The magnitude of change should always be positive, regardless of the direction of change. Magnitude of Change Direction of Change (Dollars) Exports Imports Net Exports Because of the identity equation that relates to net exports, the v in U.S. net exports is matched by in U.S. net capital outflow. Which of the following is an example of how the United States might be affected in this scenario? Check all that apply. O Zony exchanges the $15,000 for yen at the local bank, which then uses the dollars to purchase U.S. bonds. O Zony purchases $15,000 worth of U.S. bonds. O Zony purchases $15,000 worth of stock in a U.S. company.

Suppose you own a toy store in the United States, where there is high demand for the PlayNation 3, a video game console. Because of this, you spene $15,000 to increase your inventory of the gaming system, which is manufactured by Zony, a Japanese company, in Japan. Determine the effects of this transaction on exports, imports, and net exports in the U.S. economy, and enter your results in the following table. If the direction of change is "No change," enter "0" in the Magnitude of Change column. Hint: The magnitude of change should always be positive, regardless of the direction of change. Magnitude of Change Direction of Change (Dollars) Exports Imports Net Exports Because of the identity equation that relates to net exports, the v in U.S. net exports is matched by in U.S. net capital outflow. Which of the following is an example of how the United States might be affected in this scenario? Check all that apply. O Zony exchanges the $15,000 for yen at the local bank, which then uses the dollars to purchase U.S. bonds. O Zony purchases $15,000 worth of U.S. bonds. O Zony purchases $15,000 worth of stock in a U.S. company.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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E4
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