A surplus on the current account of the balance of payments indicates that:  (1) Financial inflows are less than financial outflows; (2) Imports are greater than exports; (3) Financial inflows are greater than financial outflows; (4) Exports are greater than imports

Q: Q.1.6 A surplus on the current account of the balance of payments indicates that: (1) Financial…

A: The balance of payments records a country's monetary transactions with the rest of the world. The…

Q: A country with a floating exchange rate faces a short-run recession and current account deficit.…

A: A country with a floating exchange rate faces a short term recession band current account deficit.…

Q: Which of the following is not part of the Current Account of the Balance of Payments? Answers:…

A: Balance of payment account refers to the statement of economic transactions between two countries.…

Q: The immediate impact on the balance of trade (BOT) for a country in deficit when there is an…

A: The balance of trade account is one that records all the amount of goods and services exchanged by…

Q: Explain why a stronger dollar could enlarge the U.S. balance-of-trade deficit. Explain why a weaker…

A: Balance of trade deficit refers to the situation of excess imports in the country over the exports…

Q: Which of the following transactions represents a deficit in the current account of the U.S. balance…

A: Balance of payments: It refers to the difference between the money which is coming in the economy…

Q: Balance of payments accounting. For the following international transactions, identify the balance…

A: Balance of payment is the records of  the monetary transaction occurred between nations in foreign…

Q: A rise in the domestic interest rate leads to capital inflows, which make the exchange rate…

A: A rise in domestic interest rate signifies a higher return from investment. That incentivises…

Q: Describe, with detailed explanations, the four components of the current account of the balance of…

A: The current account is used to measure the inflow and outflow of goods, investment incomes, transfer…

Q: Look at each of the cases below from the point of view of the balance of payments for Canada.…

A: The balance of payments (BOP) is basically a record of each payment or receipt made by one…

Q: China had a $214 billion overall current account surplus in 2012. Assuming that China’s net debt…

A: Current account (CA) includes the trade of G&S done with abroad while the capital account…

Q: Determine which account of the Balance-of-Payments is affected by each of the following transactions…

A: The balance of payment is the method which the countries use to record and analyze the international…

Q: an open economy, why is the demand curve for dollars in the foreign-currency exchange market…

A: In an open economy, why is the demand curve for dollars in the foreign - currency exchange market…

Q: In the balance of payments statement, a current account surplus will be matched by a    capital and…

A: The Balance of Payment record the transactions in services, goods, and assets between residents of a…

Q: If Brazil’s current account balance is -150b and its financial account balance is +130b, what must…

A: Balance of Payment is the sum of balance of current account, capital account and financial account.…

Q: Determine which account of the Balance-of-Payments is affected by each of the following transactions…

A: Balance of payments (BoP) refers to the records of all transactions of goods and services, capital…

Q: In a two-period model, as long as wealth effects are small, an increase in the world real interest…

A: Two period model deals with current as well as future consumption.

Q: An increase in government spending in a simple open economy leads to Fall in both budget and current…

A: With higher government spending, government's expenditure will be more than the government's revenue…

Q: What are the automatic adjustment mechanisms operate to correct a deficit in the balance of payments…

A: Fixed Exchange Rate refers to the regime imposed by the reserve bank or by the central government…

Q: Consider an open economy. If aggregate desired saving is greater than aggregate desired investment,…

A: Open economy interacts with other economies freely around the world.

Q: A surplus in a country's financial/capital account necessarily means a recessionary economy a…

A: Basics:- Capital account of the country shows net flow of funds of country. Inflows of funds means…

Q: Which of the following transactions is included in the current account balance of the BOP statement…

A: Balance of Payment (BOP) is a statement of the record of all economic transactions of a country with…

Q: Which of the following is one of the indicators of a rising balance of payments deficit? Multiple…

A: Answer: A balance of payment deficit arises when a country imports more than its exports. The…

Q: All of the following are surplus items on a country's balance of payments EXCEPT a. gold sales to…

A: Balance of payment is a type of financial statement of a country which includes all money…

Q: The American company Boeing sells an airplane to a Japanese airline. As a result, the US current…

A: When country import from other country then their current decreases and when the country is export…

Q: Suppose that a country with pegged exchange rate has reserves of $8 billion and is running a deficit…

A: Given Foreign exchange reserves = 8 Billion $ Current account deficit = 1 Billion per month…

Q: How do automatic adjustment mechanisms operate to correct a deficit in the balance of payments under…

A: The rectification of BOP imbalance is a fundamental priority for the country who experiences it. In…

Q: A government wants to reduce both the country’s inflation rate and its current account surplus. What…

A: Inflation refers to the rise in the general prices of the product, like rising in the price of fuel.…

Q: Select all of the following statements which can be said of a country with a current account deficit…

A: The current account deficit is a measurement of a country’s trade where the value of the goods and…

Q: INSTRUCTIONS: For each of the following, explain the effect on a) current account OR capital account…

A: Since you have posted a question with multiple sub-parts, we will solve the first three sub-parts…

Q: "If monetary policy is used to set the market equilibrium value of the exchange rate equal to the…

A: Market equilibrium value of the exchange rate is the equilibrium point where the demand and supply…

Q: If a country with floating exchange rates uses an expansionary monetary policy, the domestic…

A: Exchange rate between two currencies gives the value of one currency in terms of the other.Floating…

Q: If the federal government is running a surplus,     the surplus becomes a source of funds for the…

A: A surplus is the amount of an asset or resource that is greater than the amount that is actively…

Q: A point to the left of the balance of payments schedule (BP curve) would represent

A: Balance of Payment is a statement in which all the financial transactions made in a certain period…

Q: In the balance of payments statement, a current account surplus will be matched by a   capital and…

A: Since you have asked multiple questions, we will solve the first question for you. If you want any…

Q: (Balance of Payments) Explain where in the U.S. balance of payments an entry would be recorded for…

A: A Hong Kong financier buys some U.S. corporate stock. When foreigners buy domestic stocks, it is…

Q: If an American student buys an airline ticket on the German airline, Lufthansa, the U.S. current…

A: Answer: Ture, Explanation: The current account records the imports and exports of goods and…

Q: Q.1.11 A surplus on the current account of the balance of payments indicates that: (1) Financial…

A: Q.1.11 Th e answer is - (4) Exports are greater than imports. Therefore, A surplus on the current…

Q: Ricardian equivalence suggests that government budget deficits generated by decreases in current…

A: Current account:- it is a record of a country's transactions of goods and services, net earnings on…

Q: Given the following information: Unilateral transfers: $120 billion, Exports in goods: $1,000…

A: Balance of payment - It is a statement of account of all economic transactions of one nation with…