(a) To calculate: The merchandise trade balance by using the given data. Concept Introduction: The periodical evaluation of trade balance, i.e., the difference in the value between the imports and exports is known as Merchandise Trade Balance. The evaluation is performed on monthly and yearly basis.

Question

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Answer 1

Question

Definition Definition Difference in value of a country's net exports and net imports for goods and services in a given period. A positive balance of trade is called a surplus and coincides with more net cash inflows into a country; a negative balance of trade deficit is a deficit and results in net cash outflows. A balance of trade surplus or deficit doesn't necessarily indicate a positive or negative situation for a country.

Chapter 18, Problem 1P

To determine

(a)

To calculate:

The merchandise trade balance by using the given data.

Concept Introduction:

The periodical evaluation of trade balance, i.e., the difference in the value between the imports and exports is known as Merchandise Trade Balance. The evaluation is performed on monthly and yearly basis.

Expert Solution

Explanation of Solution

Merchandise Trade Balance = Merchandise Export – Merchandise Import

= $350 – $2425 = −$2,075

Here, the merchandise trade balance is -$2,075 billion. The negative balance indicates a trade deficit.

To determine

(b)

To calculate:

The balance on goods and services.

Expert Solution

Explanation of Solution

Balance on Goods and Services = Export of Goods and Services – Import of Goods and Services Export of Goods and services = $350 + $2145 = $2495

Import of Good and services = $2425 + $170=$2595

Balance on Goods and Services = $2495−$2595=−$100

Here, the balance on goods and services is -$100 billion. The negative balance indicates a trade deficit.

To determine

(c)

The balance on current account by using the given data.

Expert Solution

Explanation of Solution

Balance on Current Account = Net Income Transferred – Inflow of Foreign Currency

= $221.5 – $100.0= $121.5

Here, the balance on current account is $121.5 billion.

To determine

(d)

The financial account balance using the given data.

Expert Solution

Explanation of Solution

Financial Account Balance = Capital Inflow – Capital Outflow = 100.0 – 245.0= −$145.0

Here, the financial account balance is -$145.0 billion. The negative balance indicates a trade deficit.

To determine

(e)

The statistical discrepancy using the given data.

Expert Solution

Explanation of Solution

Statistical Discrepancy = Capital Outflow – Net Income Transferred = 245.0 – 221.5 = $23.5

Here, the statistical discrepancy is $23.5 billion.

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Students have asked these similar questions

The table below contains 2014 balance of payments accounts for Germany (in billions of Euros). Calculate the merchandise trade balance, the balance on goods and services, and the current account balance. Exports of goods services and income receipts (credits) 2,095 Exports of goods and services 1,756 Goods 1,479 Services 277 Primary income receipts 259 Secondary income receipts 78 Imports of goods services and income payments (debits) 1,814 Imports of goods and services 1,510 Goods 1,179 Services 330 Primary income payments 171 Secondary income payments 132 Merchandise trade balance (balance on goods) Balance on goods and services Current account balance

U.S. goods exports +$ 390 U.S. goods imports - 520 U.S. service exports +145 U.S. service imports -107 Net investment income +12 Net transfers -22 Capital account -5 Foreign purchases of U.S. assets +156 U.S. purchases of foreign assets -49 The accompanying table contains hypothetical data for the U.S. balance of payments in a year. All figures are in billions of dollars. The balance on the financial account was a A. $107 billion surplus. B. $102 billion surplus. C. $107 billion deficit. D. $102 billion deficit.

Balance of Payments (Billions of dollars) Current Accounts U.S. merchandise exports +70 U.S. merchandise imports -67 Merchandise trade balance U.S. service exports U.S. service imports +70 Services balance +35 Goods and services balance +38 Net investment income from abroad -2 Net unilateral transfers -8 Current account balance Financial Accounts Change in U.S.-owned assets abroad Change in foreign-owner assets in the U.S. -40 +42 Financial account balance Statistical discrepancy -30 Trade balance Suppose an Argentine logging company purchases American-made chainsaws. This would be entered as a item under the section of the U.S. current account. According to the table, the United States is running a trade The current account balance suggests that U.S. current account transactions (exports and imports of goods and services, as well as inflow and outflow of investment income and transfers) created outpayments of foreign currencies from the United States that were the inpayments of…

Answer 2

Question

Definition Definition Difference in value of a country's net exports and net imports for goods and services in a given period. A positive balance of trade is called a surplus and coincides with more net cash inflows into a country; a negative balance of trade deficit is a deficit and results in net cash outflows. A balance of trade surplus or deficit doesn't necessarily indicate a positive or negative situation for a country.

Chapter 18, Problem 1P

To determine

(a)

To calculate:

The merchandise trade balance by using the given data.

Concept Introduction:

The periodical evaluation of trade balance, i.e., the difference in the value between the imports and exports is known as Merchandise Trade Balance. The evaluation is performed on monthly and yearly basis.

Expert Solution

Explanation of Solution

Merchandise Trade Balance = Merchandise Export – Merchandise Import

= $350 – $2425 = −$2,075

Here, the merchandise trade balance is -$2,075 billion. The negative balance indicates a trade deficit.

To determine

(b)

To calculate:

The balance on goods and services.

Expert Solution

Explanation of Solution

Balance on Goods and Services = Export of Goods and Services – Import of Goods and Services Export of Goods and services = $350 + $2145 = $2495

Import of Good and services = $2425 + $170=$2595

Balance on Goods and Services = $2495−$2595=−$100

Here, the balance on goods and services is -$100 billion. The negative balance indicates a trade deficit.

To determine

(c)

The balance on current account by using the given data.

Expert Solution

Explanation of Solution

Balance on Current Account = Net Income Transferred – Inflow of Foreign Currency

= $221.5 – $100.0= $121.5

Here, the balance on current account is $121.5 billion.

To determine

(d)

The financial account balance using the given data.

Expert Solution

Explanation of Solution

Financial Account Balance = Capital Inflow – Capital Outflow = 100.0 – 245.0= −$145.0

Here, the financial account balance is -$145.0 billion. The negative balance indicates a trade deficit.

To determine

(e)

The statistical discrepancy using the given data.

Expert Solution

Explanation of Solution

Statistical Discrepancy = Capital Outflow – Net Income Transferred = 245.0 – 221.5 = $23.5

Here, the statistical discrepancy is $23.5 billion.

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Answer 3

Question

Definition Definition Difference in value of a country's net exports and net imports for goods and services in a given period. A positive balance of trade is called a surplus and coincides with more net cash inflows into a country; a negative balance of trade deficit is a deficit and results in net cash outflows. A balance of trade surplus or deficit doesn't necessarily indicate a positive or negative situation for a country.

Chapter 18, Problem 1P

To determine

(a)

To calculate:

The merchandise trade balance by using the given data.

Concept Introduction:

The periodical evaluation of trade balance, i.e., the difference in the value between the imports and exports is known as Merchandise Trade Balance. The evaluation is performed on monthly and yearly basis.

Expert Solution

Explanation of Solution

Merchandise Trade Balance = Merchandise Export – Merchandise Import

= $350 – $2425 = −$2,075

Here, the merchandise trade balance is -$2,075 billion. The negative balance indicates a trade deficit.

To determine

(b)

To calculate:

The balance on goods and services.

Expert Solution

Explanation of Solution

Balance on Goods and Services = Export of Goods and Services – Import of Goods and Services Export of Goods and services = $350 + $2145 = $2495

Import of Good and services = $2425 + $170=$2595

Balance on Goods and Services = $2495−$2595=−$100

Here, the balance on goods and services is -$100 billion. The negative balance indicates a trade deficit.

To determine

(c)

The balance on current account by using the given data.

Expert Solution

Explanation of Solution

Balance on Current Account = Net Income Transferred – Inflow of Foreign Currency

= $221.5 – $100.0= $121.5

Here, the balance on current account is $121.5 billion.

To determine

(d)

The financial account balance using the given data.

Expert Solution

Explanation of Solution

Financial Account Balance = Capital Inflow – Capital Outflow = 100.0 – 245.0= −$145.0

Here, the financial account balance is -$145.0 billion. The negative balance indicates a trade deficit.

To determine

(e)

The statistical discrepancy using the given data.

Expert Solution

Explanation of Solution

Statistical Discrepancy = Capital Outflow – Net Income Transferred = 245.0 – 221.5 = $23.5

Here, the statistical discrepancy is $23.5 billion.

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Answer 4

Question

Definition Definition Difference in value of a country's net exports and net imports for goods and services in a given period. A positive balance of trade is called a surplus and coincides with more net cash inflows into a country; a negative balance of trade deficit is a deficit and results in net cash outflows. A balance of trade surplus or deficit doesn't necessarily indicate a positive or negative situation for a country.

Chapter 18, Problem 1P

To determine

(a)

To calculate:

The merchandise trade balance by using the given data.

Concept Introduction:

The periodical evaluation of trade balance, i.e., the difference in the value between the imports and exports is known as Merchandise Trade Balance. The evaluation is performed on monthly and yearly basis.

Expert Solution

Explanation of Solution

Merchandise Trade Balance = Merchandise Export – Merchandise Import

= $350 – $2425 = −$2,075

Here, the merchandise trade balance is -$2,075 billion. The negative balance indicates a trade deficit.

To determine

(b)

To calculate:

The balance on goods and services.

Expert Solution

Explanation of Solution

Balance on Goods and Services = Export of Goods and Services – Import of Goods and Services Export of Goods and services = $350 + $2145 = $2495

Import of Good and services = $2425 + $170=$2595

Balance on Goods and Services = $2495−$2595=−$100

Here, the balance on goods and services is -$100 billion. The negative balance indicates a trade deficit.

To determine

(c)

The balance on current account by using the given data.

Expert Solution

Explanation of Solution

Balance on Current Account = Net Income Transferred – Inflow of Foreign Currency

= $221.5 – $100.0= $121.5

Here, the balance on current account is $121.5 billion.

To determine

(d)

The financial account balance using the given data.

Expert Solution

Explanation of Solution

Financial Account Balance = Capital Inflow – Capital Outflow = 100.0 – 245.0= −$145.0

Here, the financial account balance is -$145.0 billion. The negative balance indicates a trade deficit.

To determine

(e)

The statistical discrepancy using the given data.

Expert Solution

Explanation of Solution

Statistical Discrepancy = Capital Outflow – Net Income Transferred = 245.0 – 221.5 = $23.5

Here, the statistical discrepancy is $23.5 billion.

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Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 5

Chapter 18, Problem 1P

To determine

(a)

To calculate:

The merchandise trade balance by using the given data.

Concept Introduction:

The periodical evaluation of trade balance, i.e., the difference in the value between the imports and exports is known as Merchandise Trade Balance. The evaluation is performed on monthly and yearly basis.

Expert Solution

Explanation of Solution

Merchandise Trade Balance = Merchandise Export – Merchandise Import

= $350 – $2425 = −$2,075

Here, the merchandise trade balance is -$2,075 billion. The negative balance indicates a trade deficit.

To determine

(b)

To calculate:

The balance on goods and services.

Expert Solution

Explanation of Solution

Balance on Goods and Services = Export of Goods and Services – Import of Goods and Services Export of Goods and services = $350 + $2145 = $2495

Import of Good and services = $2425 + $170=$2595

Balance on Goods and Services = $2495−$2595=−$100

Here, the balance on goods and services is -$100 billion. The negative balance indicates a trade deficit.

To determine

(c)

The balance on current account by using the given data.

Expert Solution

Explanation of Solution

Balance on Current Account = Net Income Transferred – Inflow of Foreign Currency

= $221.5 – $100.0= $121.5

Here, the balance on current account is $121.5 billion.

To determine

(d)

The financial account balance using the given data.

Expert Solution

Explanation of Solution

Financial Account Balance = Capital Inflow – Capital Outflow = 100.0 – 245.0= −$145.0

Here, the financial account balance is -$145.0 billion. The negative balance indicates a trade deficit.

To determine

(e)

The statistical discrepancy using the given data.

Expert Solution

Explanation of Solution

Statistical Discrepancy = Capital Outflow – Net Income Transferred = 245.0 – 221.5 = $23.5

Here, the statistical discrepancy is $23.5 billion.

Answer 6

Chapter 18, Problem 1P

To determine

(a)

To calculate:

The merchandise trade balance by using the given data.

Concept Introduction:

The periodical evaluation of trade balance, i.e., the difference in the value between the imports and exports is known as Merchandise Trade Balance. The evaluation is performed on monthly and yearly basis.

Expert Solution

Explanation of Solution

Merchandise Trade Balance = Merchandise Export – Merchandise Import

= $350 – $2425 = −$2,075

Here, the merchandise trade balance is -$2,075 billion. The negative balance indicates a trade deficit.

Answer 7

Chapter 18, Problem 1P

To determine

(a)

To calculate:

The merchandise trade balance by using the given data.

Concept Introduction:

The periodical evaluation of trade balance, i.e., the difference in the value between the imports and exports is known as Merchandise Trade Balance. The evaluation is performed on monthly and yearly basis.

Answer 8

Expert Solution

Explanation of Solution

Merchandise Trade Balance = Merchandise Export – Merchandise Import

= $350 – $2425 = −$2,075

Here, the merchandise trade balance is -$2,075 billion. The negative balance indicates a trade deficit.

Answer 9

Expert Solution

Answer 10

Expert Solution

Answer 11

Expert Solution

Answer 12

To determine

(b)

To calculate:

The balance on goods and services.

Expert Solution

Explanation of Solution

Balance on Goods and Services = Export of Goods and Services – Import of Goods and Services Export of Goods and services = $350 + $2145 = $2495

Import of Good and services = $2425 + $170=$2595

Balance on Goods and Services = $2495−$2595=−$100

Here, the balance on goods and services is -$100 billion. The negative balance indicates a trade deficit.

Answer 13

To determine

(b)

To calculate:

The balance on goods and services.

Answer 14

Expert Solution

Explanation of Solution

Balance on Goods and Services = Export of Goods and Services – Import of Goods and Services Export of Goods and services = $350 + $2145 = $2495

Import of Good and services = $2425 + $170=$2595

Balance on Goods and Services = $2495−$2595=−$100

Here, the balance on goods and services is -$100 billion. The negative balance indicates a trade deficit.

Answer 15

Expert Solution

Answer 16

Expert Solution

Answer 17

Expert Solution

Answer 18

To determine

(c)

The balance on current account by using the given data.

Expert Solution

Explanation of Solution

Balance on Current Account = Net Income Transferred – Inflow of Foreign Currency

= $221.5 – $100.0= $121.5

Here, the balance on current account is $121.5 billion.

Answer 19

To determine

(c)

The balance on current account by using the given data.

Answer 20

Expert Solution

Explanation of Solution

Balance on Current Account = Net Income Transferred – Inflow of Foreign Currency

= $221.5 – $100.0= $121.5

Here, the balance on current account is $121.5 billion.

Answer 21

Expert Solution

Answer 22

Expert Solution

Answer 23

Expert Solution

Answer 24

To determine

(d)

The financial account balance using the given data.

Expert Solution

Explanation of Solution

Financial Account Balance = Capital Inflow – Capital Outflow = 100.0 – 245.0= −$145.0

Here, the financial account balance is -$145.0 billion. The negative balance indicates a trade deficit.

Answer 25

To determine

(d)

The financial account balance using the given data.

Answer 26

Expert Solution

Explanation of Solution

Financial Account Balance = Capital Inflow – Capital Outflow = 100.0 – 245.0= −$145.0

Here, the financial account balance is -$145.0 billion. The negative balance indicates a trade deficit.

Answer 27

Expert Solution

Answer 28

Expert Solution

Answer 29

Expert Solution

Answer 30

To determine

(e)

The statistical discrepancy using the given data.

Expert Solution

Explanation of Solution

Statistical Discrepancy = Capital Outflow – Net Income Transferred = 245.0 – 221.5 = $23.5

Here, the statistical discrepancy is $23.5 billion.

Answer 31

To determine

(e)

The statistical discrepancy using the given data.

Answer 32

Expert Solution

Explanation of Solution

Statistical Discrepancy = Capital Outflow – Net Income Transferred = 245.0 – 221.5 = $23.5

Here, the statistical discrepancy is $23.5 billion.

Answer 33

Expert Solution

Answer 34

Expert Solution

Answer 35

Expert Solution

Answer 36

Ch. 18 - Prob. 1P Ch. 18 - Prob. 2P Ch. 18 - Prob. 3P Ch. 18 - Prob. 4P Ch. 18 - Prob. 5P Ch. 18 - Prob. 6P Ch. 18 - Prob. 7P

Explanation of Solution

(b) To calculate: The balance on goods and services.

Explanation of Solution

(c) The balance on current account by using the given data.

Explanation of Solution

(d) The financial account balance using the given data.

Explanation of Solution

(e) The statistical discrepancy using the given data.

Explanation of Solution

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Chapter 18 Solutions

(b)

To calculate:

The balance on goods and services.

(c)

The balance on current account by using the given data.

(d)

The financial account balance using the given data.

(e)

The statistical discrepancy using the given data.