A "closed" economy is one in which the: domestic savings equal domestic investment. domestic interest rate equals the world interest rate. level of output is fixed. O price level is fixed.
Q: Which of these situations will result in a stronger Omani Riyal? a. An increase in the exportation…
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A: The capital account is the part of BOP that record all the transactions between the home country…
Q: Exports S750 Imports S600 Net income from abroad -S225 Net unilateral transfers S30 Based on the…
A: Exports=$750 Imports=$600 NFIA=$-225 NT=$30
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A: Export is the foreign demand of domestic products Whereas import is domestic demand for foreign…
Q: Given the following data: Desired Investment P: $300 Current Account Balance CA: $– 270 Net Exports…
A: Given: Id=$300 CA=$-270 NX=$-270 Y=$1200 G=$200 To find: Cd and domestic consumption
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A: i) NNP at fc=GDP at mp-Indirect taxes+NFIA-Capital consumption allowance+SubsidiesNNP at…
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A: It refers to the rate at which the currency of one nation can be exchanged for another. For example,…
Q: In an open economy, national saving equalsdomestic investmenta. plus the government’s budget…
A: An open economy represents that economy that establishes contact with the rest of the world in terms…
Q: 3. You are given the data below for 2008 for the imaginary country of Amagre, whose currency is the…
A: Net foreign investment = Earning on foreign investment - foreign earnings on amagre investment
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A: GDP: GDP or gross domestic product is the estimation of the final value of all the goods and…
Q: In a small open economy, if domestic saving equals $50 billion and domestic investment equals $50…
A: Given: Savings = $50 billion Investment = $50 billion.
Q: National Income at constant prices can be obtained by multiplying current production of output to…
A: National income measures the value of final goods and services produced in the economy within a…
Q: Ifthe value of a nation's imports exceeds the value of its exports,which of the following is NOT…
A: Net Exports = Exports - Imports If imports > exports, then Net Exports are Negative. OPTION A is…
Q: Consider a small open economy. The saving curve is given by sª(r„) = 100 + 2000rw The investment…
A: Given Sd = 100 + 2000r Id = 300 – 1000r Interest rate = 5 % As rate of 5 %, Sd = 100 + 2000(0.05) =…
Q: Inflation results in: O An increase in the purchasing power of money. O A decrease in the purchasing…
A: Answer to the question is as follows:
Q: a) The GDP deflator measures the ratio of nominal GDP to the real GDP. What is the value of the GDP…
A: BALANCE OF PAYMENT is the account which records the monetary transaction amongst countries.
Q: if US citizen decides to consume less and save more, then the foreign-exchange price of the dollar…
A: Exchange rate is the rate at which the nation's currencies are exchanged. And it is determined at…
Q: A country engages in open international trade with other countries for goods and services and relies…
A: Currency Depreciation: It refers to a situation in an economy that leads to a reduction in the…
Q: If the actual exchange rate for the euro value of the Australian dollar is higher than the exchange…
A: Exchange Rate is defined as the price of a nations money in relation to another nations currency.…
Q: These are currency quotes found on a foreign market: GH 4.30/$, and GH 4.55/$. Calculate the…
A: Appreciation is the increase in the value of a country's currency with respect to another foreign…
Q: An increase in productivity in a country will cause its currency to ________ because it can produce…
A: When there is an increase in productivity, more output is produced so the value of currency…
Q: Which of the following statements is FALSE? Trade liberalization did not promote development in…
A: Trade: It refers to the exchange of goods and services in the economy. The more the trade between…
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A: Here, it is given that a small open economy is experiencing an increase in household wealth which…
Q: A6) Finance Suppose the direct price euros per pound was €1.2115/£ and the exchange rates versus the…
A: The three rates we have are: €1.2115/£ €0.7636/$ $1.5477/£
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A: Delta exports goods=$30billion and exports services =$10billion Imports goods=$40 billion and import…
Q: For a small, open economy when spending exceeds production then I. This country will run a trade…
A: Solution: For a small, open economy when spending exceeds production then a) This country will run a…
Q: item billions of No Coin dollars consumption expenditure 731 Export of good and services 267…
A: Given: Consumption expenditure 731Exports of goods and services 267Government expenditure 240Net…
Q: Desired national saving: s= $20 billion+ ($400 billion) Desired investment: /"$40 billion ($400…
A: The measure that depicts final value of goods and services within an economy during given time span…
Q: Suppose that national saving is $1568 billion, investment is $1835 billion, and private saving is…
A: Answer to the question is as follows:
Q: Pancraziland is an open economy, whose official currency is the pound. At the end of 2019, it had a…
A: A net international investment position (NIIP) measures the gap between a nation's stock of foreign…
Q: Consider a small open economy where the world interest rate is 5%. The domestic investment demand at…
A: Given the world interest rate = 5% Domestic investment demand = $1200 Desired national savings =…
Q: Current account transactions are records of the incomes and expenditures from exports and imports,…
A: Current account records the export and import of goods and services, unilateral transfers in form…
Q: True/False The exchange rate between two countries can be thought of as unrelated to any economic…
A: Exchange rate is the price of one currency being measured in terms of another currency.
Q: Suppose a country has private saving of $4 million, investment of $10 million, government purchases…
A: Given: Private Saving=$4 million Investment=$10 million Government purchases=$6 million Tax…
Q: In a small open economy, if domestic investment equals $70 billion, domestic private saving equals…
A: Domestic saving in a country is the sum total of the private and government savings. Here, domestic…
Q: QUESTION 9 A trade deficit must be equivalent to domestic investment minus domestic savings. True O…
A: The balance of trade of a country is known as the difference between the value of the country's…
Q: Based on the Balance of Payments account presented in this table, the net exports are: a. 2300 b.…
A: Net exports = total Exports - total Imports = 1500 + 800 – 2100 – 500 = -300
Q: a. The major economic functions of the interest rate are O to provide market incentives for saving…
A: "Since you have asked multiple questions, we will solve first question for you .. If you want any…
Q: You are considering buying a bottle of wine. Supposethat the euro appreciates by 15% with respect to…
A: Currency appreciation is when the value of currency is increases in relative to other foreign…
Q: Over time, a real depreciation in the value of a nation's currency should result in Select one: O a.…
A: Exchange rate is the value of a country's currency in terms of other country's currency.…
Q: u have the following annual figures for the New Zealand economy. Investment expenditure…
A: The current account helps investors to find out whether the nation is going through a trade deficit…
Q: A1 3b Using the IS/LM/BP model and assuming perfect capital mobility, explain: b. how a…
A: The Mundell Fleming refers to an open macro application of the standard IS-LM curve analysis, The…
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A: Concerning a country's business cycle, Rapid growth rates of production and employment is commonly…
Q: Suppose an economy’s national accounts are GNP = 100, C = 70, I = 40, G = 20 and EX = 20 where GNP…
A: The GNP can be calculated as follows: Thus, the import (IM) is 50. Current account balance can be…
Q: In a small open economy, how will the domestic be affected by a positive productivity shock? O.…
A: an open economy includes all sector such as Household sector , Producers sector , Government sector…
Q: b. positive net capital outflow and negative net exports. c. negative net capital outflow and…
A: The GDP is the all out of all worth added made in an economy. The worth added implies the worth of…
Q: Which of the following will cause a real depreciation?a reduction in the exchange rate of foreign…
A: Depreciation refers to the reduction of the value of the currency or assets in the economy, which…
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- Ifthe value of a nation's imports exceeds the value of its exports,which of the following is NOT true? a.Net exports are negative. b.GDP is less than the sum of consumption, investment, and government purchases. c.Domestic investment is greater than national saving. d.The nation is experiencing a net outflow of capitaIn a small open economy, an increase in government spending implies: O a) an increase in S-l(r *); b) b) a decrease in S-l(r*); Oc) no change in S-1(r"); O d) a decrease in r *;In an open economy the national income identity shows that: Where S stands for national savings, I for investment spending and NX for the trade balance. Carefully state this identity in words and explain why it is expected to hold.
- Consider a small open economy that takes the world real interest rate as given. Suppose that initially the world real interest rate is less than the country’s autarky real interest rate. Now suppose there is a change in tax policy that leads to an increase in domestic investment demand. Which of the following is TRUE? a. The economy may flip from importing capital to exporting capital b. There is an increase in the quantity of domestic saving c. There is an increase in the real interest rate paid by domestic investors d. None of the other optionsThe country of Freedonia has a GDP of $4000, consumption of $1500, and government purchases of $900. What does this situation imply?Question 1 options:Investment is equal to $1600.Investment plus net capital outflow is equal to $1600.Investment plus net exports is equal to $2400.Saving is equal to $2400. Please give me correct answer with calculation and full explanation otherwise i give multiple downvote Note:- Please avoid using ChatGPT and refrain from providing handwritten solutions; otherwise, I will definitely give a downvote. Also, be mindful of plagiarism. Answer completely and accurate answer. Rest assured, you will receive an upvote if the answer is accurate.If U.S. net exports are negative, then net capital outflow is A. negative, so American assets bought by foreigners are greater than foreign assets bought by Americans. B. positive, so foreign assets bought by Americans are greater than American assets bought by foreigners. C. positive, so American assets bought by foreigners are greater than foreign assets bought by Americans. D. negative, so foreign assets bought by Americans are greater than American assets bought by foreigners.
- If Sprvt (private sector savings) and the CA (current account) are the only SOURCES of savings in the economy, Question 41 options: net Exports (NX) must be zero or positive the Current Account must be zero or positive the government budget is either balanced or in deficit investment must be zeroConsider a small open economy that takes the world real interest rate as given. Suppose the world real interest rate is less than the country’s autarky real interest rate. Which of the following is TRUE? a. Domestic saving exceeds domestic investment b. There is capital outflow c. There is excess demand for capital d. None of the other optionsSelect all that are true given an increase in foreign investment from the domestic economy: A. Domestic economic growth (GDP) increases, ceteris paribus B. Investment from the domestic economy to the foreign economy decreases C. The domestic currency depreciates
- You are given the following information about an economy: Gross private domestic investment = 40 Government purchases of goods and services = 30 Gross national product (GNP) = 200 Current account balance = -20 Taxes = 60 Government transfer payments to the domestic private sector = 25 Interest payments from the government to the domestic private sector = 15 (Assume all interest payments by the government go to domestic households.) Factor income received from rest of world = 7 Factor payments made to rest of world = 9 Find the following, assuming that government investment is zero: (a.) Consumption (b.) Net exports (c.) GDP (d.) Net factor payments from abroad (e.) Private saving (f.) Government saving (g.) National savingConsider a small open economy that takes the world real interest rate as given. Suppose that initially the world real interest rate is less than the country’s autarky real interest rate. Now suppose there is a change in tax policy that leads to an increase in domestic saving supply. Which of the following is TRUE? a. The economy may flip from importing capital to exporting capital b. There is an increase in the quantity of domestic investment c. There is an increase in the real interest rate paid to domestic savers d. None of the other options(b) Discuss how changes in local real interest rates and foreign interest rates impact the decision to carry out investment by (i) foreigners and (ii) locals.
