If the National bank of Kazakhstan undertakes a policy to raise interest rates, capital flows to/from Kazakhstan will be affected in which of the following ways (other things being unchanged)? a. capital outflows will not change but tenge depreciates O b. capital outflows from Kazakhstan will decrease and tenge appreciates O c. capital outflows from Kazakhstan will increase and tenge depreciates O d. capital outflows from Kazakhstan will increase and tenge appreciates e. capital outflows from Kazakhstan will decrease and tenge depreciates

If the National bank of Kazakhstan undertakes a policy to raise interest rates, capital flows to/from Kazakhstan will be affected in which of the following ways (other things being unchanged)? a. capital outflows will not change but tenge depreciates O b. capital outflows from Kazakhstan will decrease and tenge appreciates O c. capital outflows from Kazakhstan will increase and tenge depreciates O d. capital outflows from Kazakhstan will increase and tenge appreciates e. capital outflows from Kazakhstan will decrease and tenge depreciates

Brief Principles of Macroeconomics (MindTap Course List)

8th Edition

ISBN:9781337091985

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter14: A Macroeconomic Theory Of The Open Economy

Section: Chapter Questions

Problem 1CQQ

See similar textbooks

Similar questions

If a country is running a government budget surplus, why is (T - G) on the left side of the saving-investment identity?
Use the demand-and-supply of foreign currency graph to determine what would happen to a small, open economy that experienced capital outflows.
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 euros
In an open economy, national saving equalsdomestic investmenta. plus the government’s budget deficit.b. minus the net exports of goods and services.c. plus the net outflow of capital.d. minus foreign portfolio investment
For a European investor, what is the rate of return in euro on: “a ¥10,000 deposit in a Japanese bank in a year when the interest rate on Yen is 12 % and the Yen per euros exchange rate moves from ¥1.40 per euros to ¥1.20 per euros” A. Compute the rate of return without the formula B. Compute the approximation of this rate of return using the formula Only typed answer
1. What explains how the dollars per euro exchange rate will change in the future if the exchange rate is wxpected to rise. 2. What is addressed by the USMCA? 3. Country A has a GDP of 60,000,000 and country B has a per capita of 2,000. If the populations of countries a and b are 40,000 and 20,000 respectively, which country is most developed based on per capita GDP? 4. how can a difference in Gini coefficients for the United States and china be interpreted 5. which of the following trends have followed globalization?
a Figure 1 shows the exogenous world interest rate (r*) determines the level of investment (I) and the difference between saving (S) and investment determines net capital outflow and net exports (NX) for a small open economy. What would happen to I, NX and S if: i. The government of this small open economy uses expansionary fiscal policy. ii. The government of other countries (abroad) uses contractionary fiscal policy. b Suppose the price of a cup of tea is Rs.50 in Pakistan and $2 in USA, the value of nominal exchange rate is $0.006364 per PKR. Calculate the value of real exchange rate (ε) and interprete its meaning. Also, discuss the relationship between net exports (NX) and real exchange rate. c Briefly explain the theory of purchasing power parity (PPP) with the help of example.
Only need d and e 2.) The country of Albanystan (country A) forms a small open economy on its own. It has savings SA = 30 +300r and investment IA = 80 - 200r. a.) If r = 0.2, is country A a borrower or a lender? b.) Below what interest rate would country A be a borrower? The country of Bostonland (country B) decides to join and together they form a large open economy with SB = 40 + 100 and IB = 5 - 500r c.) What is the equilibrium interest rate? d. )What is CAA and CAB e.)Which country borrows and which country lend? The country of Cincinnatisland (country C) joins country B to form a large open economy, while country A forms a small open economy on its own with Sc = 50 + 200r and Ic = 25 - 400r. f.) What is the new equilibrium interest rate? g.) Is country A a borrower or a lender?
Answer These Three Sub Parts i) In an open economy, Y = C + I + G + NX. Using symbols from this identity, write anexpression that defines national saving, S, in an open economy.S = _________________________ . ii) True or False? In an open economy, the following is always true: S = I + NCO, where I isinvestment spending and NCO is net capital outflow. iii) In an open economy, a country’s net capital outflow is:a.) the value of domestic assets purchased by foreigners minus the value of foreign assetspurchased by domestic residentsb.) the value of foreign assets purchased by domestic residents minus the value of domesticassets purchased by foreigners.
An American garment company establishes an office in the Slowakische Republic. How would the transaction affect U.S Net capital outflow? Does the transaction affect direct investment or portfolio investment?
1. Would each of the following groups be happy or unhappy if ringgit appreciated? Explain.A) Hong Kong pension funds holding Malaysian government bonds B) Malaysian manufacturing industries C) Australian tourists planning a trip to Malaysia D) A Malaysian firm trying to purchase property overseas 2. How would the following transactions affect Malaysian exports, imports and net exports？ A）A Thai citizen shops at a store in Kota Bahru
1. When calculating gross national disposable income in an open economy, we adjust gross nationalexpenditure by:a. subtracting exports and adding back imports.b. adding in net income earned from foreign sources, plus the trade balance, plus net unilateraltransfers from abroad.c. subtracting depreciation, payroll taxes, and indirect business taxes, while adding in subsidies.d. taking out net factor income from abroad and subtracting net unilateral transfers.