Question 1

You travel to Paris and pay for a $100 dinner with your credit card.How is this accounted for in the balance of payments?

Accepted Answer

The answer of You travel to Paris and pay for...

Question 2

Assume in a closed economy:
C = 50 + 0.6 (Y - T)
G = 15
I = 15
T = 2
(a)Calculate Y at equilibrium
(b)Calculate C
(c)Assume the economy is open
EX = 4 + 3EP  /P
IM = 8 + 0.1 (Y - T)- 2EP  /P
E = 3
P  = 1
P = 1.5
Find equilibrium Y.

Accepted Answer

The answer of Assume in a closed economy:
C = 50...

Question 3

Every international transaction automatically enters the balance of payments

Accepted Answer

Every international transaction affects both the current account and the capital account, thus making it a credit in one account and a debit in the other. Therefore, every international transaction is recorded twice, once as a credit and once as a debit. The balance of payments reflects these transactions and their impact on the country's economy.

Question 4

Fill in the following table.

Accepted Answer

The answer of Fill in the following table. ...

Question 5

Assume in a closed economy:
C = 40 + 0.8(Y - T)
G = 10
I = 20
T = 0,where T are taxes.
(a)Calculate Y at equilibrium.
(b)Calculate C,I,and G at equilibrium.
(c)Now assume the economy is open with exports and imports activities,
EX = 5 + 4EP  /P
IM = 10 + 0.1 (Y - T)- 3EP  /P
E = 3
P  = 1.5
P = 2
Find equilibrium Y.

Accepted Answer

The answer of Assume in a closed economy:
C = 40...

Question 6

An American buys a Japanese car,paying by writing a check on an account with a bank in New York.How would this be accounted for in the balance of payments?

Accepted Answer

The purchase of a Japanese car by an American with a check written on a New York bank account would be recorded in the current account as a U.S. import of goods (the Japanese car) and in the financial account as a U.S. asset export (the payment made with the check). Therefore, the best choice is E.

Question 7

Which one of the following statements is FALSE?

Accepted Answer

The statement that the U.S. foreign debt was paid off in the 1990s and allowed for a current account surplus is false. The U.S. foreign debt has continued to grow since then and currently stands at about 40 percent of GNP. Furthermore, the deficit has not only returned in recent years, but has also been sustained since the 1980s.

Question 8

What can one learn from the following figure?

Accepted Answer

The answer of What can one learn from the following...

Question 9

Discuss the values of private saving in closed and open economies.

Accepted Answer

The answer of Discuss the values of private saving in...

Question 10

Fill in the following table.

Accepted Answer

The answer of Fill in the following table. ...

Question 11

What is the national income identity for a closed economy?

Accepted Answer

The answer of What is the national income identity for...

Question 12

The official settlements balance or balance of payments is the sum of

Accepted Answer

The official settlements balance, or balance of payments, includes the current account balance and the capital account balance, but it subtracts the non-reserve portion of the financial account balance. This is because the official settlements balance aims to capture only those transactions that affect a country's official reserves.

Question 13

What is the national income identity for an open economy?

Accepted Answer

The answer of What is the national income identity for...

Question 14

The United States issues a $10,000 debt forgiveness to Argentina.How is this accounted for in the balance of payments?

Accepted Answer

The answer of The United States issues a $10,000 debt...

Question 15

The services British capital provides in Spain are a service export from Britain

Accepted Answer

Service exports are added to the GDP of the exporting country in calculating its GNP. Therefore, in this case, the services provided by British capital in Spain are added to British GDP in calculating British GNP.

Question 16

A U.S.citizen buys a newly issued share of stock in England,paying for his order with a check,which the British company deposits in its own U.S.bank account in New York.How is this transaction accounted for in the balance of payments?

Accepted Answer

The answer of A U.S.citizen buys a newly issued share...

Question 17

The German government carries out an official foreign exchange intervention in which it uses dollars held in an American bank to buy French currency from its citizens.How is this accounted for in the balance of payments?

Accepted Answer

The answer of The German government carries out an official...

Question 18

The position of the United States current account balance in 2015 was

Accepted Answer

The statement "borrowed roughly 3 percent of its GNP, leading to a large current account deficit" accurately describes the position of the United States current account balance in 2015. A current account deficit means that the country is spending more on imports than it is earning through exports, resulting in a net outflow of money from the economy.

Question 19

The profits of a Spanish factory with British owners are

Accepted Answer

The answer of The profits of a Spanish factory with...

Question 20

Fill in the following table.

Accepted Answer

The answer of Fill in the following table. ...

Quiz 13: National Income Accounting and the Balance of Payments

You travel to Paris and pay for a $100 dinner with your credit card.How is this accounted for in the balance of payments?

Assume in a closed economy: C = 50 + 0.6 (Y - T) G = 15 I = 15 T = 2 (a)Calculate Y at equilibrium (b)Calculate C (c)Assume the economy is open EX = 4 + 3EP /P IM = 8 + 0.1 (Y - T)- 2EP /P E = 3 P = 1 P = 1.5 Find equilibrium Y.

Every international transaction automatically enters the balance of payments

Fill in the following table.

An American buys a Japanese car,paying by writing a check on an account with a bank in New York.How would this be accounted for in the balance of payments?

Which one of the following statements is FALSE?

What can one learn from the following figure?

Discuss the values of private saving in closed and open economies.

Fill in the following table.

What is the national income identity for a closed economy?

The official settlements balance or balance of payments is the sum of

What is the national income identity for an open economy?

The United States issues a $10,000 debt forgiveness to Argentina.How is this accounted for in the balance of payments?

The services British capital provides in Spain are a service export from Britain

A U.S.citizen buys a newly issued share of stock in England,paying for his order with a check,which the British company deposits in its own U.S.bank account in New York.How is this transaction accounted for in the balance of payments?

The German government carries out an official foreign exchange intervention in which it uses dollars held in an American bank to buy French currency from its citizens.How is this accounted for in the balance of payments?

The position of the United States current account balance in 2015 was

The profits of a Spanish factory with British owners are

Fill in the following table.