184. If Israel’s domestic investment exceeds its national saving, then Israel has
a.
positive net capital outflows and negative net exports.
b.
positive net capital outflows and positive net exports.
c.
negative net capital outflows and negative net exports.
d.
negative net capital outflows and positive net exports.
185. In which of the following situations must national saving rise?
a.
Both domestic investment and net capital outflow increase.
b.
Domestic investment increases and net capital outflow decreases.
c.
Domestic investment decreases and net capital outflow increases.
d.
Both domestic investment and net capital outflow decrease.
186. Other things the same, if a country saves less, then
a.
b.
c.
d.
187. Other things the same, if a country saves more, then
a.
b.
c.
d.
188. Other things the same, if a country’s domestic investment decreases, then
a.
b.
c.
d.
189. Other things the same, if a country has a trade deficit and saving rises,
a.
net capital outflow rises, so the trade deficit increases.
b.
net capital outflow rises, so the trade deficit decreases.
c.
net capital outflow falls, so the trade deficit increases.
d.
net capital outflow falls, so the trade deficit decreases.
190. Other things the same, a country could move from having a trade deficit to having a trade surplus if either
a.
saving rose or domestic investment rose.
b.
saving rose or domestic investment fell.
c.
saving fell or domestic investment rose.
d.
saving fell or domestic investment fell.
191. If a country were to save more, but its domestic investment remained the same, then which of the following would
rise?
a.
both net capital outflow and net exports
b.
net capital outflow but not net exports
c.
net exports but not net exports
d.
neither net exports nor net capital outflow
192. Other things the same, a country could move from having a trade surplus to having a trade deficit if either
a.
saving rose or domestic investment rose.
b.
saving rose or domestic investment fell.
c.
saving fell or domestic investment rose.
d.
saving fell or domestic investment fell.
193. Last year a country had exports of $100 billion, imports of $70 billion, and purchased $60 billion worth of foreign
assets. What was the value of domestic assets purchased by foreigners?
a.
$70 billion
b.
$40 billion
c.
$30 billion
d.
$10 billion
194. Last year a country had exports of $50 billion, imports of $60 billion, and domestic investment of $40 billion. What
was its saving last year?
a.
$30 billion
b.
$20 billion
c.
$10 billion
d.
–$10 billion
195. During some year a country had exports of $50 billion, imports of $70 billion, and domestic investment of $100
billion. What was its saving during the year?
a.
$80 billion
b.
$100 billion
c.
$120 billion
d.
$150 billion
196. If a county has 25 billion euros of imports, 15 billion euros of exports, and sells 20 billion euros of assets to
foreigners, how many foreign assets do domestic residents purchase?
a.
5 billion euros
b.
10 billion euros
c.
30 billion euros
d.
None of the above are correct.
197. If a country has saving of $2 trillion and investment of $1.5 trillion, then it has
a.
a trade surplus and its net capital outflow = $.5 trillion.
b.
a trade surplus and its net capital outflow = -$.5 trillion.
c.
a trade deficit and its net capital outflow = $.5 trillion.
d.
a trade deficit and its net capital outflow = -$.5 trillion.
198. A country has $100 million of net exports and $170 million of saving. Net capital outflow is
a.
$70 million and domestic investment is $170 million.
b.
$70 million and domestic investment is $270 million.
c.
$100 million and domestic investment is $70 million.
d.
None of the above is correct.
199. A country has $3 billion of domestic investment and net exports of $2 billion. What is its saving?
a.
$1 billion
b.
$2billion
c.
$3 billion
d.
$5 billion
200. A country has $3 billion of domestic investment and net exports of –$2 billion. What is its saving?
a.
–$1 billion
b.
–$2 billion
c.
$1 billion
d.
$2 billion
201. A country has $60 million of saving and domestic investment of $40 million. Net exports are
a.
$20 million.
b.
–$20 million.
c.
$100 million.
d.
–$100 million.
202. A country has $50 million of domestic investment and net capital outflow of $15 million. What is saving?
a.
$65 million
b.
–$65 million
c.
$35 million
d.
–$35 million
203. A country has $45 million of domestic investment and net capital outflow of –$60 million. What is its saving?
a.
$15 million
b.
–$15 million
c.
$105 million
d.
–$105 million
204. A country has $40 billion of domestic investment and net capital outflows of –$20 billion. What is the country’s
saving?
a.
–$60 billion
b.
–$20 billion
c.
$20 billion
d.
$60 billion
205. A country has $20 billion of domestic investment and net capital outflow of $10 billion. What is saving?
a.
$10 billion
b.
$30 billion
c.
–$20 billion
d.
–$30 billion
206. A country has net capital outflow of –10 billion euros and domestic investment of 20 billion euros. What is its
national saving?
a.
30 billion euros
b.
10 billion euros
c.
–10 billion euros
d.
–30 billion euros
207. A country has net capital outflow of $40 billion. Which of the following is consistent with this net capital outflow?
a.
It has –$40 billion of net exports.
b.
Purchases of foreign assets by domestic residents exceed purchases of domestic assets by foreign residents by
$40 billion.
c.
Its saving is $35 billion and its domestic investment is $5 billion.
d.
All of the above are consistent with a net capital outflow of $40 billion.
208. Suppose the world had only two countries and domestic residents of country A purchased $50 billion of assets from
country B and country B purchased $30 billion of assets from country A. What would the net capital outflows of both
countries be?
a.
$50 billion for country A and $30 billion for country B
b.
$30 billion for country A and $50 billion for country B
c.
$20 billion for country A and -$20 billion for country B
d.
–$20 billion for country A and $20 billion for country B
209. In an open economy, gross domestic product equals $1,970 billion, government expenditure equals $300 billion,
investment equals $500 billion, and net capital outflow equals $280 billion. What is consumption expenditure?
a.
$280 billion
b.
$780 billion
c.
$890 billion
d.
$1,170 billion
210. In an open economy, gross domestic product equals $3,500 billion, consumption expenditure equals $2100 billion,
government expenditure equals $400 billion, investment equals $800 billion, and net exports equals $200 billion. What is
national savings?
a.
$200 billion
b.
$600 billion
c.
$800 billion
d.
$1,000 billion
211. In an open economy, gross domestic product equals $1,650 billion, government expenditure equals $250 billion, and
savings equals $550 billion. What is consumption expenditure?
a.
$250 billion
b.
$300 billion
c.
$550 billion
d.
$850 billion
212. In an open economy, gross domestic product equals $2,450 billion, consumption expenditure equals $1,390 billion,
government expenditure equals $325 billion, investment equals $510 and net capital outflow equals $225 billion. What is
national saving?
a.
$225 billion
b.
$510 billion
c.
$735 billion
d.
$1,390 billion
Table 31-1
Bolivian Trade Flows
Goods
Services
Purchased
Abroad
$40 billion
Purchased
Abroad
$20 billion
Sold Abroad
$10 billion
Sold Abroad
$25 billion
213. Refer to Table 31–1. What are Bolivia’s exports?
a.
$60 billion
b.
$35 billion
c.
$10 billion
d.
None of the above are correct.
214. The country of Wiknam has net capital outflow of $1,000, government purchases of $5,000 and consumption of
$20,000. Which of the following is correct?
a.
If its domestic investment is $1,000, its GDP is $26,000.
b.
If its domestic investment is $2,000, its GDP is $28,000.
c.
If its domestic investment is $5,000, its GDP is $29,000.
d.
None of the above are correct.
215. The country of Sylvania has a GDP of $900, investment of $200, government purchases of $200, and net capital
outflow of -$100. What is consumption?
a.
$700
b.
$600
c.
$500
d.
$300
216. The country of Elbia has a GDP of $2,000, consumption of $1,300, and government purchases of $400. Which of the
following is equal to $300?
a.
domestic investment
b.
domestic investment plus net capital outflow
c.
domestic investment minus net capital outflow
d.
None of the above is correct.
217. Suppose a country’s net capital outflow does not change, but its investment rises by $250 billion.
a.
Its saving must have risen by $250 billion so its net exports have risen.
b.
Its saving must have risen by $250 billion, but its net exports are unchanged.
c.
Its saving must have fallen by $250 billion, so its net exports have fallen.
d.
Its saving must have fallen by $250 billion, but its net exports are unchanged.
218. From 1960 to about 1980 the net capital outflow of the U.S. was typically
a.
small but always positive.
b.
small and sometimes negative and sometimes positive.
c.
large and positive.
d.
large but sometimes negative and sometimes positive.
219. After 1980 in the United States,
a.
national saving fell below investment and net capital outflow was a large positive number.
b.
national saving fell below investment and net capital outflow was a large negative number.
c.
investment fell below saving and net capital outflow was a large positive number.
d.
investment fell below saving, so net capital outflow was a large negative number.
220. Since 1980 U.S. net capital outflow has been
a.
negative, meaning that foreigners were buying more capital assets from the United States than Americans were
buying abroad.
b.
negative, meaning that Americans were buying more capital assets abroad than foreigners were buying from
the United States.
c.
positive, meaning that foreigners were buying more capital assets from the United States than Americans were
buying abroad.
d.
positive, meaning that Americans were buying more capital assets abroad than foreigners were buying from
the United States.
221. From 1980-1987, U.S. net capital outflow as a percent of GDP became a
a.
larger positive number.
b.
smaller positive number.
c.
larger negative number.
d.
smaller negative number.
222. From 1980 to 1987
a.
foreigners were buying more assets from the United States than Americans were buying abroad. The United
States was going into debt.
b.
Americans were buying more assets abroad than foreigners were buying from the United States. The United
States was going into debt.
c.
foreigners were buying more assets from the United States than Americans were buying abroad. The United
States was moving into surplus.
d.
Americans were buying more assets abroad than foreigners were buying from the United States. The United
States was moving into surplus.
223. Most of the change from 1980 to 1987 in U.S. net capital outflow as a percent of GDP was due to a(n)
a.
decrease in U.S. investment.
b.
decrease in U.S. national saving.
c.
increase in U.S. investment.
d.
increase in U.S. national saving.
224. From 1991-2000, U.S. net capital outflow as a percent of GDP became a
a.
larger positive number.
b.
smaller positive number.
c.
larger negative number.
d.
smaller negative number.
225. Most of the change from 1991 to 2000 in U.S. net capital outflow as a percent of GDP was due to a(n)
a.
decrease in U.S. investment.
b.
decrease in U.S. national saving.
c.
increase in U.S. investment.
d.
increase in U.S. national saving.
226. From 2000 to 2012 the U.S. had a trade
a.
surplus and a large net capital inflow.
b.
surplus and a large net capital outflow.
c.
deficit and a large net capital inflow.
d.
deficit and a large net capital outflow.
227. Between 2000 and 2009, tough economic times lead to
a.
investment falling by a larger percentage than saving rose, so net capital outflow rose.
b.
investment falling by by a larger percentage than saving, so net capital outflow rose.
c.
investement falling by a smaller percentage than saving, so net capital outflow fell.
d.
investment and saving both falling by about the same percentage.
228. In which period was most of the change in U.S. net capital outflow due to an increase in investment in the U.S.?
a.
1980-1987
b.
1991-2000
c.
2000-2012
d.
None of the above are correct.
229. If citizens of a country are not saving much, it is better to
a.
force citizens to save.
b.
reduce investment.
c.
have foreigners invest in the domestic economy than no one at all.
d.
prevent opportunities for citizens to buy capital assets abroad.
Table 31-2
Colombian Trade Flows
Trade Flows
Goods
Services
Purchased
Abroad
50 billion pesos
Purchased
Abroad
30 billion pesos
Sold Abroad
60 billion pesos
Sold Abroad
40 billion pesos
230. Refer to Table 31-2. What are Colombian exports?
a.
110 billion pesos
b.
100 billion pesos
c.
80 billion pesos
d.
60 billion pesos
231. Refer to Table 31-2. What are Colombian imports?
a.
50 billion pesos
b.
60 billion pesos
c.
80 billion pesos
d.
100 billion pesos
232. Refer to Table 31-2. What are Colombian net exports?
a.
20 billion pesos
b.
10 billion pesos
c.
–10 billion pesos
d.
–20 billion pesos
233. A country imports $20 billion worth of goods and services and exports $15 billion worth of goods and services.
What is its net capital outflow?
a.
$5 billion, so its residents’ purchases of foreign assests exceed foreigners’ purchases of domestic assets
b.
$5 billion, so foreigners’ purchases of domestic assets exceed its resident’s purchases of foreign assets
c.
–$5 billion, so its residents’ purchases of foreign assests exceed foreigners’ purchases of domestic assets
d.
–$5 billion, so foreigners’ purchases of domestic assets exceed its residents’ purchases of foreign assets
234. Visitors to a country hosting a world soccer tournament purchase food, souvenirs, and accommodations while
attending the tournament. Which of the following should these expenditures raise?
a.
The host country’s net exports and its net capital outflow.
b.
The host country’s net exports but not its net capital outflow.
c.
The host country’s net capital outflow but nor its net exports.
d.
Neither the host country’s net exports not its net capital outflow.
235. If the price levels in the U.S and in Canada are unchanged, but the nominal exchange rate (Canadian dollars per U.S.
dollar) rises, then
a.
the U.S. dollar appreciates and so U.S. net exports rise.
b.
the U.S. dollar appreciates and so U.S. net exports fall.
c.
the U.S. dollar depreciates and so U.S. net exports rise.
d.
the U.S. dollar depreciates and so U.S. net exports fall.