If the merchandise trade balance is-$25, net international transfer payments and net international factor income are $4, the balance of payments on goods and services is-$25, and the balance of payments on financial account is $28, then the statistical discrepancy is: O 3. O-S1. O -53. O S1.
Q: If Canadian purchases of foreign real estate are $100 million, Canadian purchases of foreign-…
A: Capital account is financial in nature which records the transactions associated with change in…
Q: The foilowing data provides the nominal exchange rates for the euro ( the British pound (E), and the…
A: The exchange rate is defined as the rate at which the currency of one nation can be traded for…
Q: Suppose that in 2018, Botswana's capital account has a deficit. That means.. (Check all that apply)…
A: The capital account is the part of BOP that record all the transactions between the home country…
Q: Other things remaining constant, higher trade deficits in the U.S. will lead to: a. an increase in…
A: Trade Deficit: Trade deficit is the term generally used to describe the gap between the import and…
Q: When exports exceed imports, all of the following are true except: O net foreign investment is…
A: Export means when goods and services are produced in one country and sold to buyer in other country…
Q: Determine which account of the Balance-of-Payments is affected by the following transaction: You…
A: Balance of payment has two accounts : Current Account and Capital Account. The current account…
Q: fast plz 28- Which of the following increases the supply of foreign exchange? a. Import of goods…
A: The demand and supply of foreign exchange determine the price of foreign exchange. Just like the…
Q: A change in the euro-dollar exchange rate from $1 per epro to $2 per euro would the U.S. price of…
A: The exchange rate between two nations' currency is generally defined as the price of one nation's…
Q: The following information on Ghana’s Balance of Payments Accounts for 2013 (million U.S.…
A: Solution: 1. Calculation of Ghana current account: Current Account: It refers to the account that…
Q: Somebody has bought US Dollar with one-third of his money and Euro with two-third. Dollar has gained…
A: D=3,2 E=3 Y=1,7
Q: 1 .Refer to the following table in which Qd is the quantity of yen demanded, P is the dollar price…
A: Given information Demand quantity and supply quantity in year 1 and year 2 of Yen are given. Dollar…
Q: The government of a country is not considered a resident while calculating the balance of payments.…
A: Balance of payment is the records of all monetary transaction occurred between countries .It…
Q: Consider the balance-of-payments accounting information for Lalaland in 2010 as shown in the table…
A: Given: Exports=$500 billionImports=$510 billionNet-foreign investment income=-$40 billionCapital…
Q: Which of the following most likely results in devaluation of tenge? a. Inflow of portfolio…
A: The devaluation refers to a decline in the value of the currency. The currency devalued when the…
Q: Capital consumption allowance 440 Federal government purchases of goods and services Compensation of…
A: The expenditure approach is a method for calculating a nation's gross domestic product (GDP) by…
Q: Consider the balance-of-payments accounting information for Lalaland in 2010 as shown in the table…
A: The balance of payments tracks global exchanges. At the point when assets go into a country, a…
Q: 12. Imagine that you are the manager of a company considering direct foreign investment. What…
A: 12) As a manager of a firm considering FDI, a person would choose the country with the lowest…
Q: Assume that the dollar price level is 15,0 level is 10,000GBP/Consumption bundle, and the exchange…
A: Purchasing power is the value of a currency expressed in terms of the number of goods or services…
Q: Calculate the Ghana Current Account. Calculate the Ghana Capital and Financial Account Balance. What…
A: Balance of Payment is the records of all the transactions that are made between the residents of one…
Q: If the US dollar appreciated against the Japanese yen what would you expect to happen to US net…
A: In the flexible exchange rate system, when the value of domestic currency increases in terms of…
Q: According to the balance-of-payments, positive net exports mean that the country has .. O greater…
A: Savings: Savings are the amount that is saved for the future or the quantity of money that is…
Q: Suppose that nominal exchange rate is $1 = 6 and it remains the same during the year. In this period…
A: Given: Nominal Exchange Rate : $1= 6 Lira Inflation rate in Turkey = 20% Inflation rate in US = 4%…
Q: A deficit-financed increase in government purchases O A. crowds out investment by decreasing the…
A: “Since you have asked multiple question, we will solve the first question for you. If you want any…
Q: Determine which account of the Balance-of-Payments is affected the following transaction: A local…
A: The BOP shows the total value of all financial transactions, as well as commodity or service…
Q: Determine which account of the Balance-of-Payments is affected the following transaction: A local…
A: Balance of payments are important for the economy. Track records of different transactions are kept…
Q: 31. The new LR exchange rate E_(#/€) after the policy change: O1) (a) 0.25 O 2) (b) 0.5 O 3) (c) 1…
A: The way a country regulates its currency in the foreign exchange market is referred to as an…
Q: b. If in a given year (year X) the parity ratio stood at 0.60, it would mean that O prices paid by…
A: Since you have asked multiple questions, we will solve the first question for you. If you want any…
Q: A6) Finance Suppose the direct price euros per pound was €1.2115/£ and the exchange rates versus the…
A: The three rates we have are: €1.2115/£ €0.7636/$ $1.5477/£
Q: The demand for Canadian dollars in the foreign-exchange market is derived from... O a. Imports to…
A: In the international market, countries make an exchange of goods and services at a specific exchange…
Q: Purchasing Power Parity (PPP) theory states that Select one: O a the prices of standard commodity…
A: "Since you have asked multiple questions, we will solve first question for you .. If you want any…
Q: Exporter A offered woolen blanket at price USD 1000 M/T CIFC 3% Hamburg. If the freight costs is USD…
A: Exports are defined as products produced in a nation and purchased by people of other nation.
Q: In a sytem of fixed exchange rates, the automatic balance-of-payments adjustment process for a…
A: A country's government proposed what its currency will be valued in terms of something else, as well…
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: A Guatemalan citizen working in Canada sends remittances to her family in Guatemala. This…
A: Remittances refer to money sent by migrant wokers working in foreign countries to their home…
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: Table 18-3 Country Units of Foreign Currency per U.S. Dollar U.S. Dollars per Unit of Foreign…
A: Exchange rate refers to value of currency of a country with respect to the value of currency of…
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: 8. In a small open economy, net exports NX depend negatively on domestic in- come Y and negatively…
A: The IS curve shows the inverse relationship between interest rate and quantity. The IS curve is…
Q: e which account of the Balance-of-Payments is affected by the following transaction: You invest in a…
A: A current account record transaction of export and imports of goods and services and unilateral…
Q: Last year a country had exports of $100 billion, imports of $70 billion, and purchased $60 billion…
A: To find : Value of domestic assets purchased by foreigners.
Q: If one Canadian dollar buys US$0.85, and one Euro buys US$1.20, then one Euro should buy O a. C$1.02…
A: Given CAD/USD rate = 0.85 $ EUR/USD rate = 1.20 $
Q: If the United States had a capital and financial account deficit of $50 billion, we could say the…
A: If the United States had a capital and financial account deficit of $50 billion, we could say the…
Q: 2
A: Exchange Rate refers to the amount of a certain foreign currency that a unit of foreign currency can…
Q: If Canadian exports of goods and services were $30 billion, imports of goods and services were $24…
A: When talking about current account balance in terms of international trade, it can be said that this…
Q: The nominal exchange rate is .80 euros per dollar and the real exchange rate is 4/3. Which of the…
A: Formula to be used: Real exchange in rate = Ratio of prices measured in same unit =Price of a good…
Q: b) Suppose that the current spot exchange rate of U.S. dollars for Australian dollars, Suss/As. is…
A: For different time periods, the value of the domestic currency varies on the spot foreign exchange…
Q: Dinotopia's Balance of Payments Account, 2014 (billions of S) CURRENT ACCOUNT Exports of products…
A: When exports exceed imports, the current account shows a positive balance. When imports exceed…
Q: How could (2) the acquisition of a Moldovan soft drinks company by a US company for 5 million…
A: Balance of payment refers to the total transaction of goods and services along with financial…
Q: If the foreign currency equivalent of the domestic price of a commodity is more than the foreign…
A: LOP: - Law of one price means that the price of a good is the same at all locations.
Q: An example of a deficit item on the u.s. balance of payments is 1) the sale of a spark plug made by…
A: A balance of payments(BoP) deficit implies the nation imports of services and goods are greater than…
Q: 2 Suppose that the current spot exchange rate is €0.8250/S and the three-month forward exchange rate…
A: Exchange rate is the rate at which domestic currency will be converting into the foreign currency…
Q: If the real exchange rate is 2.0, the price level of domestic goods is 120, and the dollar price of…
A: exchange rate is a rate of currency two countries deal with each other in trade so here we calculate…
Q: QUESTION 6 From 1980 to 2000, the dollar-yen exchange rate fell from 240 yen/dollar to 102…
A: The exchange rate refers to the price of one currency expressed in terms of another. `
Q: Dollars per Franc So .70 .60 .50 40 Do D2 3 4 5 6 7 Quantity of Francs (Millions) Refer to Figure…
A: The equilibrium is at D1=S0wherethe new exchange rate is $0.60 per franc
Q: Pancraziland is an open economy, whose official currency is the pound. At the end of 2019, it had a…
A: Here, given information is: NIIP in 2019: 90 pounds Current Account balance in 2020: -10 pounds To…
Q: f the interest rate on euro-denominated assets is 13 percent and it is 15 percent on…
A: The actual return on peso denominated assets is 15%. As the euro appreciates by 4%, the peso will…
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
- determine the purchasing power of the country China for aconsumer good that they would buy from their Canadian trading partner. Also, calculate whatCanada’s purchasing power is with a country that they import from. See example below on Coca Colaand Mexico. Purchasing Power Example In the example of the picture, if a Canadian company operating in Mexico were to pay its Mexican employeesthe equivalent of $10/hour CAD (or 100 pesos/hour according to our fictional exchange rate), theMexican employee would actually enjoy greater purchasing power (the ability to acquire 20 colasversus only 10 colas) than his/her Canadian counterparts.1. Exporter A offered woolen blanket at price USD 1000 M/T CIFC 3% Hamburg. If the freight costs is USD 80 per M/T, and insurance premium is USD 10 per M/T, the purchasing price of the product is RMB 4000 per M/T, the domestic direct and indirect costs per M/T will be account for 15% of purchasing price, please calculate the total costs of export, the net income from the export and the exporting conversion cost of foreign exchange. If the current exchange rate is 6.5 RMB/USD, is it profitable from the export?If the Japanese price level rises by 5% relative to theprice level in the United States, what does the theoryof purchasing power parity predict will happen to thevalue of the Japanese yen in terms of dollars?
- The demand for Australian dollars in the foreign exchange market equals 14000 – 3000e and thesupply of Australian dollars in the foreign exchange market equals 2000 + 2000e, where e is thenominal exchange rate expressed in euros per Australian dollar. If the Australian dollar is fixed at 2euros per Australian dollar, then to maintain this fixed rate, what is the required change in theReserve Bank of Australia’s holdings of euros? 1increase by 4000 euros 2decrease by 2000 euros 3decrease by 4000 euros 4increase by 2000 eurosQ.1.10 Which of the following statements is correct? (2)(1) When a British firm invests in a bicycle manufacturing facility in South Africa,the amount concerned is entered as an inflow on the current account of theSouth African balance of payments.(2) When someone purchases a second‐hand car, the transaction is included inthe calculation of GDP in the year the sale took place.(3) A deficit on the current account of the balance of payments indicates thatthe country exported more than it imported during the period in question.(4) In the base year, the value of nominal GDP is equal to the value of real GDP.How did large trade deficits hurt the East Asian countries in the mid 1980s? (Recall that trade deficits are equivalent to inflows of financial capital from abroad.)
- D6) Suppose that domestic price level for a basket of goods is given by P = 311 in domestic currency, and the foreign price level for the same basket of goods is given by P* = 5 in foreign currency. What should the exchange rate of domestic currency per foreign currency be according to absolute purchasing power parity? Round to the nearest whole number.These are currency quotes found on a foreign market: GH 4.30/$, and GH 4.55/$. Calculate the percent appreciation or depreciation in each caseA British company that exports shoes to Switzerland wants to exchange the Swiss franc (SF) for British pounds. If the US Dollar Rate of the two currencies is disclosed as follows: £0.5120-0.5130/US$, SF1.1230-1.1240/US$ Calculate and disclose the purchase/sale exchange rate between the two currencies as £/SF by the Cross Rate. If the export price received by a British company is SF10,000, what is the amount of British pound after the exchange?
- Zeta Corporation is a Philippine ExportCompany. It sells its goods to the US.Assuming that the BSP prints morePhilippine peso bills, how will thesales of Zetabe affected? A. The decrease in money supply will increase the value of each peso, require less peso to get one USD, hence Zeta's sales in peso will decrease.B. The increase in money supply will increase the value of each peso, require less peso to get one USD, hence Zeta's sales in peso will decrease.C. The decrease in money supply will lower the value of each peso, require more peso to get one USD, hence Zeta's sales in peso will increase.D. The increase in money supply will lower the value of each peso, require more peso to get one USD, hence Zeta's sales in peso will increase.The following information on Ghana’s Balance of Payments Accounts for 2013 (million U.S. Dollars) is provided. CURRENT ACCOUNT US$ 1. Merchandise Exports ( £.o.b) 11,679.40 2. Merchandise Imports (£.o.b) -16,092.50 Trade balance -4,413.1 3. Services (net) -2,346.84 Receipts 3,539.40 Payments -5,886.24 4. Income (net) 4,155.98 Receipts -592.96 Payments 202.24 5. Current Transfers (net) 795.20 CAPITAL & FINANCIAL ACCOUNT 6. Capital Account 1,127.78 Capital Transfers 1,127.78 7. Financial Account Direct Investments 3,355.68 Portfolio Investments -87.28 Other Investments 1,737.96 Of which: Short term capital -164.12 Other capital investments 2,172.40…Give typing answer with explanation and conclusion Consider the exchange rate between U.S. Dollar and Mexican Peso: USD/MXN. Initially, the supply curve for USD is 100 + eN bln dollars per week and the demand curve is 140 - eN bln dollars per week. There is a financial crisis in Mexico and the government fears that it may lead to capital outflows that would make the crisis even worse. They decide that if Mexican Peso depreciates by more than 20% the central bank will step in and fix the exchange rate. As the crisis unfolds the demand for the U.S. dollars increases to 142 - eN and the supply of dollars falls to 99 + eN. How should the central bank of Mexico react to this change?
