EP ECONOMICS,AP EDITION-CONNECT ACCESS
20th Edition
ISBN: 9780021403455
Author: McConnell
Publisher: MCGRAW-HILL HIGHER EDUCATION
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Question
Chapter 39, Problem 2RQ
To determine
The balance on capital and financial accounts.
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Say that in Miami, in Coral Gables, a big mac cost $4.25 and a large fries cost $2.50. In Japan, the total cost of a big mac and
large fries is 81 Yen. The according to purchasing power parity, the exchange rate that equalizes purchasing power of this
basket of goods is
8.5
Š 12
O 6.5
O 10
QUESTION 9
Honduras is on a fixed exchange rate with the U.S. The exchange rate is 3.0 pesos to the U.S dollar. Domestic credit is 40 and the
money supply is 100. The backing ratio is.
O 0.3
0.4
0.6
O 0.2
O We do not have enough information
QUESTION 10
Honduras forms a currency board. Given the information in 9, how much does it need to increase domestic credit to form a
currency board.
60
40
-60
-50
O We do not have enough information.
Assume all transactions are between private individuals.Ā A U.S. citizen buys a Japanese bond. This transaction will be entered in the US balance of payments as _______________.
a) an increase in investment income and an increase in foreign private assets in the US
b) a decrease in private US assets abroad and an increase in foreign private assets in the US
c) an increase in imports and an increase in foreign private assets in the US
d) an increase in private US assets abroad and an increase in foreign private assets in the US
Chapter 39 Solutions
EP ECONOMICS,AP EDITION-CONNECT ACCESS
Ch. 39.1 - Prob. 1QQCh. 39.1 - Prob. 2QQCh. 39.1 - Prob. 3QQCh. 39.1 - Prob. 4QQCh. 39 - Prob. 1DQCh. 39 - Prob. 2DQCh. 39 - Prob. 3DQCh. 39 - Prob. 4DQCh. 39 - Prob. 5DQCh. 39 - Prob. 6DQ
Ch. 39 - Prob. 7DQCh. 39 - Prob. 8DQCh. 39 - Prob. 9DQCh. 39 - Prob. 10DQCh. 39 - Prob. 11DQCh. 39 - Prob. 1RQCh. 39 - Prob. 2RQCh. 39 - Prob. 3RQCh. 39 - Prob. 4RQCh. 39 - Prob. 5RQCh. 39 - Prob. 6RQCh. 39 - Prob. 7RQCh. 39 - Prob. 8RQCh. 39 - Prob. 9RQCh. 39 - Prob. 10RQCh. 39 - Prob. 1PCh. 39 - Prob. 2PCh. 39 - Prob. 3PCh. 39 - Prob. 4PCh. 39 - Prob. 5P
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