two reasons: They export raw materials and export finish goods Developing economy importing machinery and other capital 2 reasons discussed above is why a country could run a trade deficit and hence be an international borrower. In which of these 2 cases should one be worried about the sustainability of the deficit and the ability of the country to pay back foreign loans in the future? Why?

two reasons: They export raw materials and export finish goods Developing economy importing machinery and other capital 2 reasons discussed above is why a country could run a trade deficit and hence be an international borrower. In which of these 2 cases should one be worried about the sustainability of the deficit and the ability of the country to pay back foreign loans in the future? Why?

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

True/False A pro-savings policy by the US would likely reduce the US trade deficit.
5
Discuss the strategy to tackle debt problem of any countries?
I just need correct answer of last part with explanation. Please solve only E part. Balance of Payments The year is 2018. Debtland’s GDP is $650 billion. Debtland has a current account deficit of $42 billion. Debtland’s capital account is in a $12 billion surplus. In addition, Debtland factors located in foreign countries earn $17 billion. Debtland has a trade deficit of $33 billion. Assume Debtland neither gives nor receives unilateral transfers, and assume that there are no capital gains on external wealth. a. What was the change in Debtland’s external wealth (W) during 2018? b. Compute Debtland’s net factor income from abroad (NFIA). c. How much income did foreign factors of production earn in Debtland (IMFS)? d. Compute Debtland’s gross national expenditure (GNE), gross national income (GNI), and gross national disposable income (GNDI). e. If Debtland’s external wealth was –$150 billion at the end of 2017, what was it at the end of 2018.
3
Turkey has run a trade deficit for almost every year during the past few decades. Which of the following is the main factor leading to this situation? a.The Turkish lira is overvalued against foreign currencies. b.International demand for Turkish goods and services is low. c.Domestic demand for foreign goods and services is high. d.National saving in Turkey is low relative to domestic investment.
What difference does it make whether a Japanese or a US citizen buys the US bonds issued to finance a government budget deficit?
An economy can run a trade deficit (have negative exports) permanently if: a. The Current and Financial account generate a net outflow of money, and the external debt does not increase as percentage of GDP. b. The level of GDP of the country is sufficiently low. c. Migration of the national labour force to overseas is allowed. d. The Current and Financial account bring enough net inflow of money, and the external debt does not increase as percentage of GDP.
9. A deficit in the financial account means that the nation has:a. imported more assets than it has exported. b. exported more assets than it has imported. c. saved more than it has invested. d. produced more than it has consumed.
3
a. In the diagram, shift the relevant curve(s) to the show the long-run effect of an increase in the trade deficit, if the accompanying capital account surplus supports investment. Price level LRAS AS X AD Price level GDP b. In the diagram, shift the relevant curve(s) to the show the long-run effect of an increase in the trade deficit, if the accompanying capital account surplus supports consumption. LRAS AS X AD GDP
SUBJECT: Engineering Economics Number 6