Change in reserves.

Question

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Answer 1

Question

Chapter 20, Problem 3FT

Subpart (a):

To determine

Change in reserves.

Subpart (a):

Expert Solution

Explanation of Solution

Change in reserves are calculated as follows:

Change in reserves = Current Account −(−) Capital Account=−10−(−)15=−10+15=+5

The change in official reserves is $5.

Economics Concept Introduction

Concept introduction:

Current account: It is the account of the exports and imports of goods and services along with the grants, unilateral payments, and aids of a country in a year. It includes all the short-term transactions.

Capital account: The capital account does not deal with the imports and exports of a country. It deals with the transactions of the purchase and the sale of foreign assets and liabilities over time, which is the financial account. Thus, it is the long-term account.

Subpart (b):

To determine

Capital account.

Subpart (b):

Expert Solution

Explanation of Solution

Capital account is calculated as follows:

(−)Capital Account= Current Account−Change in reserves=−10−(−3)=−10+3=−7Capital Account=+7

The capital account is $7.

Economics Concept Introduction

Concept introduction:

Current account: It is the account of the exports and imports of goods and services along with the grants, unilateral payments, and aids of a country in a year. It includes all the short-term transactions.

Capital account: The capital account does not deal with the imports and exports of a country. It deals with the transactions of the purchase and the sale of the foreign assets and liabilities over time, which is the financial account. Thus, it is the long-term account.

Subpart (c):

To determine

Current account and capital account.

Subpart (c):

Expert Solution

Explanation of Solution

The current account is calculated as follows:

Current Account= Income−Expenses=4,000−12,000=−8,000

The current account is -$8,000.

Since the balance of payment is balanced, the capital account must be +$8,000.

Economics Concept Introduction

Concept introduction:

Balance of Payments: It is a record of all the transactions of income flow into the country and out of the country with the rest of the world in a particular time period. Thus, it is the record of the transactions of the people of a country with the rest of the world.

Current account: It is the account of the exports and imports of goods and services along with the grants, unilateral payments, and aids of a country in a year. It includes all the short-term transactions.

Capital account: The capital account does not deal with the imports and exports of a country. It deals with the transactions of the purchase and the sale of the foreign assets and liabilities over time, which is the financial account. Thus, it is the long-term account.

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Answer 2

Question

Chapter 20, Problem 3FT

Subpart (a):

To determine

Change in reserves.

Subpart (a):

Expert Solution

Explanation of Solution

Change in reserves are calculated as follows:

Change in reserves = Current Account −(−) Capital Account=−10−(−)15=−10+15=+5

The change in official reserves is $5.

Economics Concept Introduction

Concept introduction:

Current account: It is the account of the exports and imports of goods and services along with the grants, unilateral payments, and aids of a country in a year. It includes all the short-term transactions.

Capital account: The capital account does not deal with the imports and exports of a country. It deals with the transactions of the purchase and the sale of foreign assets and liabilities over time, which is the financial account. Thus, it is the long-term account.

Subpart (b):

To determine

Capital account.

Subpart (b):

Expert Solution

Explanation of Solution

Capital account is calculated as follows:

(−)Capital Account= Current Account−Change in reserves=−10−(−3)=−10+3=−7Capital Account=+7

The capital account is $7.

Economics Concept Introduction

Concept introduction:

Current account: It is the account of the exports and imports of goods and services along with the grants, unilateral payments, and aids of a country in a year. It includes all the short-term transactions.

Capital account: The capital account does not deal with the imports and exports of a country. It deals with the transactions of the purchase and the sale of the foreign assets and liabilities over time, which is the financial account. Thus, it is the long-term account.

Subpart (c):

To determine

Current account and capital account.

Subpart (c):

Expert Solution

Explanation of Solution

The current account is calculated as follows:

Current Account= Income−Expenses=4,000−12,000=−8,000

The current account is -$8,000.

Since the balance of payment is balanced, the capital account must be +$8,000.

Economics Concept Introduction

Concept introduction:

Balance of Payments: It is a record of all the transactions of income flow into the country and out of the country with the rest of the world in a particular time period. Thus, it is the record of the transactions of the people of a country with the rest of the world.

Current account: It is the account of the exports and imports of goods and services along with the grants, unilateral payments, and aids of a country in a year. It includes all the short-term transactions.

Capital account: The capital account does not deal with the imports and exports of a country. It deals with the transactions of the purchase and the sale of the foreign assets and liabilities over time, which is the financial account. Thus, it is the long-term account.

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Answer 3

Question

Chapter 20, Problem 3FT

Subpart (a):

To determine

Change in reserves.

Subpart (a):

Expert Solution

Explanation of Solution

Change in reserves are calculated as follows:

Change in reserves = Current Account −(−) Capital Account=−10−(−)15=−10+15=+5

The change in official reserves is $5.

Economics Concept Introduction

Concept introduction:

Current account: It is the account of the exports and imports of goods and services along with the grants, unilateral payments, and aids of a country in a year. It includes all the short-term transactions.

Capital account: The capital account does not deal with the imports and exports of a country. It deals with the transactions of the purchase and the sale of foreign assets and liabilities over time, which is the financial account. Thus, it is the long-term account.

Subpart (b):

To determine

Capital account.

Subpart (b):

Expert Solution

Explanation of Solution

Capital account is calculated as follows:

(−)Capital Account= Current Account−Change in reserves=−10−(−3)=−10+3=−7Capital Account=+7

The capital account is $7.

Economics Concept Introduction

Concept introduction:

Current account: It is the account of the exports and imports of goods and services along with the grants, unilateral payments, and aids of a country in a year. It includes all the short-term transactions.

Capital account: The capital account does not deal with the imports and exports of a country. It deals with the transactions of the purchase and the sale of the foreign assets and liabilities over time, which is the financial account. Thus, it is the long-term account.

Subpart (c):

To determine

Current account and capital account.

Subpart (c):

Expert Solution

Explanation of Solution

The current account is calculated as follows:

Current Account= Income−Expenses=4,000−12,000=−8,000

The current account is -$8,000.

Since the balance of payment is balanced, the capital account must be +$8,000.

Economics Concept Introduction

Concept introduction:

Balance of Payments: It is a record of all the transactions of income flow into the country and out of the country with the rest of the world in a particular time period. Thus, it is the record of the transactions of the people of a country with the rest of the world.

Current account: It is the account of the exports and imports of goods and services along with the grants, unilateral payments, and aids of a country in a year. It includes all the short-term transactions.

Capital account: The capital account does not deal with the imports and exports of a country. It deals with the transactions of the purchase and the sale of the foreign assets and liabilities over time, which is the financial account. Thus, it is the long-term account.

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Answer 4

Question

Chapter 20, Problem 3FT

Subpart (a):

To determine

Change in reserves.

Subpart (a):

Expert Solution

Explanation of Solution

Change in reserves are calculated as follows:

Change in reserves = Current Account −(−) Capital Account=−10−(−)15=−10+15=+5

The change in official reserves is $5.

Economics Concept Introduction

Concept introduction:

Current account: It is the account of the exports and imports of goods and services along with the grants, unilateral payments, and aids of a country in a year. It includes all the short-term transactions.

Capital account: The capital account does not deal with the imports and exports of a country. It deals with the transactions of the purchase and the sale of foreign assets and liabilities over time, which is the financial account. Thus, it is the long-term account.

Subpart (b):

To determine

Capital account.

Subpart (b):

Expert Solution

Explanation of Solution

Capital account is calculated as follows:

(−)Capital Account= Current Account−Change in reserves=−10−(−3)=−10+3=−7Capital Account=+7

The capital account is $7.

Economics Concept Introduction

Concept introduction:

Current account: It is the account of the exports and imports of goods and services along with the grants, unilateral payments, and aids of a country in a year. It includes all the short-term transactions.

Capital account: The capital account does not deal with the imports and exports of a country. It deals with the transactions of the purchase and the sale of the foreign assets and liabilities over time, which is the financial account. Thus, it is the long-term account.

Subpart (c):

To determine

Current account and capital account.

Subpart (c):

Expert Solution

Explanation of Solution

The current account is calculated as follows:

Current Account= Income−Expenses=4,000−12,000=−8,000

The current account is -$8,000.

Since the balance of payment is balanced, the capital account must be +$8,000.

Economics Concept Introduction

Concept introduction:

Balance of Payments: It is a record of all the transactions of income flow into the country and out of the country with the rest of the world in a particular time period. Thus, it is the record of the transactions of the people of a country with the rest of the world.

Current account: It is the account of the exports and imports of goods and services along with the grants, unilateral payments, and aids of a country in a year. It includes all the short-term transactions.

Capital account: The capital account does not deal with the imports and exports of a country. It deals with the transactions of the purchase and the sale of the foreign assets and liabilities over time, which is the financial account. Thus, it is the long-term account.

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Answer 5

Chapter 20, Problem 3FT

Subpart (a):

To determine

Change in reserves.

Subpart (a):

Expert Solution

Explanation of Solution

Change in reserves are calculated as follows:

Change in reserves = Current Account −(−) Capital Account=−10−(−)15=−10+15=+5

The change in official reserves is $5.

Economics Concept Introduction

Concept introduction:

Current account: It is the account of the exports and imports of goods and services along with the grants, unilateral payments, and aids of a country in a year. It includes all the short-term transactions.

Capital account: The capital account does not deal with the imports and exports of a country. It deals with the transactions of the purchase and the sale of foreign assets and liabilities over time, which is the financial account. Thus, it is the long-term account.

Subpart (b):

To determine

Capital account.

Subpart (b):

Expert Solution

Explanation of Solution

Capital account is calculated as follows:

(−)Capital Account= Current Account−Change in reserves=−10−(−3)=−10+3=−7Capital Account=+7

The capital account is $7.

Economics Concept Introduction

Concept introduction:

Current account: It is the account of the exports and imports of goods and services along with the grants, unilateral payments, and aids of a country in a year. It includes all the short-term transactions.

Capital account: The capital account does not deal with the imports and exports of a country. It deals with the transactions of the purchase and the sale of the foreign assets and liabilities over time, which is the financial account. Thus, it is the long-term account.

Subpart (c):

To determine

Current account and capital account.

Subpart (c):

Expert Solution

Explanation of Solution

The current account is calculated as follows:

Current Account= Income−Expenses=4,000−12,000=−8,000

The current account is -$8,000.

Since the balance of payment is balanced, the capital account must be +$8,000.

Economics Concept Introduction

Concept introduction:

Balance of Payments: It is a record of all the transactions of income flow into the country and out of the country with the rest of the world in a particular time period. Thus, it is the record of the transactions of the people of a country with the rest of the world.

Current account: It is the account of the exports and imports of goods and services along with the grants, unilateral payments, and aids of a country in a year. It includes all the short-term transactions.

Capital account: The capital account does not deal with the imports and exports of a country. It deals with the transactions of the purchase and the sale of the foreign assets and liabilities over time, which is the financial account. Thus, it is the long-term account.

Answer 6

Chapter 20, Problem 3FT

Subpart (a):

To determine

Change in reserves.

Subpart (a):

Expert Solution

Explanation of Solution

Change in reserves are calculated as follows:

Change in reserves = Current Account −(−) Capital Account=−10−(−)15=−10+15=+5

The change in official reserves is $5.

Economics Concept Introduction

Concept introduction:

Current account: It is the account of the exports and imports of goods and services along with the grants, unilateral payments, and aids of a country in a year. It includes all the short-term transactions.

Capital account: The capital account does not deal with the imports and exports of a country. It deals with the transactions of the purchase and the sale of foreign assets and liabilities over time, which is the financial account. Thus, it is the long-term account.

Answer 7

Chapter 20, Problem 3FT

Subpart (a):

To determine

Change in reserves.

Answer 8

Subpart (a):

Expert Solution

Explanation of Solution

Change in reserves are calculated as follows:

Change in reserves = Current Account −(−) Capital Account=−10−(−)15=−10+15=+5

The change in official reserves is $5.

Answer 9

Subpart (a):

Expert Solution

Answer 10

Subpart (a):

Expert Solution

Answer 11

Expert Solution

Answer 12

Economics Concept Introduction

Concept introduction:

Current account: It is the account of the exports and imports of goods and services along with the grants, unilateral payments, and aids of a country in a year. It includes all the short-term transactions.

Capital account: The capital account does not deal with the imports and exports of a country. It deals with the transactions of the purchase and the sale of foreign assets and liabilities over time, which is the financial account. Thus, it is the long-term account.

Answer 13

Subpart (b):

To determine

Capital account.

Subpart (b):

Expert Solution

Explanation of Solution

Capital account is calculated as follows:

(−)Capital Account= Current Account−Change in reserves=−10−(−3)=−10+3=−7Capital Account=+7

The capital account is $7.

Economics Concept Introduction

Concept introduction:

Current account: It is the account of the exports and imports of goods and services along with the grants, unilateral payments, and aids of a country in a year. It includes all the short-term transactions.

Capital account: The capital account does not deal with the imports and exports of a country. It deals with the transactions of the purchase and the sale of the foreign assets and liabilities over time, which is the financial account. Thus, it is the long-term account.

Answer 14

Subpart (b):

To determine

Capital account.

Answer 15

Subpart (b):

Expert Solution

Explanation of Solution

Capital account is calculated as follows:

(−)Capital Account= Current Account−Change in reserves=−10−(−3)=−10+3=−7Capital Account=+7

The capital account is $7.

Answer 16

Subpart (b):

Expert Solution

Answer 17

Subpart (b):

Expert Solution

Answer 18

Expert Solution

Answer 19

Economics Concept Introduction

Concept introduction:

Current account: It is the account of the exports and imports of goods and services along with the grants, unilateral payments, and aids of a country in a year. It includes all the short-term transactions.

Capital account: The capital account does not deal with the imports and exports of a country. It deals with the transactions of the purchase and the sale of the foreign assets and liabilities over time, which is the financial account. Thus, it is the long-term account.

Answer 20

Subpart (c):

To determine

Current account and capital account.

Subpart (c):

Expert Solution

Explanation of Solution

The current account is calculated as follows:

Current Account= Income−Expenses=4,000−12,000=−8,000

The current account is -$8,000.

Since the balance of payment is balanced, the capital account must be +$8,000.

Economics Concept Introduction

Concept introduction:

Balance of Payments: It is a record of all the transactions of income flow into the country and out of the country with the rest of the world in a particular time period. Thus, it is the record of the transactions of the people of a country with the rest of the world.

Current account: It is the account of the exports and imports of goods and services along with the grants, unilateral payments, and aids of a country in a year. It includes all the short-term transactions.

Capital account: The capital account does not deal with the imports and exports of a country. It deals with the transactions of the purchase and the sale of the foreign assets and liabilities over time, which is the financial account. Thus, it is the long-term account.

Answer 21

Subpart (c):

To determine

Current account and capital account.

Answer 22

Subpart (c):

Expert Solution

Explanation of Solution

The current account is calculated as follows:

Current Account= Income−Expenses=4,000−12,000=−8,000

The current account is -$8,000.

Since the balance of payment is balanced, the capital account must be +$8,000.

Answer 23

Subpart (c):

Expert Solution

Answer 24

Subpart (c):

Expert Solution

Answer 25

Expert Solution

Answer 26

Economics Concept Introduction

Concept introduction:

Balance of Payments: It is a record of all the transactions of income flow into the country and out of the country with the rest of the world in a particular time period. Thus, it is the record of the transactions of the people of a country with the rest of the world.

Current account: It is the account of the exports and imports of goods and services along with the grants, unilateral payments, and aids of a country in a year. It includes all the short-term transactions.

Capital account: The capital account does not deal with the imports and exports of a country. It deals with the transactions of the purchase and the sale of the foreign assets and liabilities over time, which is the financial account. Thus, it is the long-term account.