Unlock document.
This document is partially blurred.
Unlock all pages and 1 million more documents.
Get Access
Chapter 21 - The Balance of Payments, Exchange Rates, and Trade Deficits
1. International transactions fall into what two broad categories?
2. "International trade" refers to:
Chapter 21 - The Balance of Payments, Exchange Rates, and Trade Deficits
3. If a U.S. importer can purchase 10,000 British pounds for $20,000, the rate of exchange is:
4. In international financial transactions, what are the only two things that individuals and
firms can exchange?
5. Which of the following would call for inpayments to the United States?
Chapter 21 - The Balance of Payments, Exchange Rates, and Trade Deficits
6. Which of the following would call for outpayments from the United States?
7. The current account in a nation's balance of payments includes:
8. A nation's capital and financial account:
Chapter 21 - The Balance of Payments, Exchange Rates, and Trade Deficits
9. In 2009, the capital account in the U.S. balance of payments was in:
10. In 2009, the capital and financial account in the U.S. balance of payments was in:
11. The financial account balance is a nation's:
Chapter 21 - The Balance of Payments, Exchange Rates, and Trade Deficits
12. A nation's official reserves:
13. If a nation has a current account surplus and it does not have to make any inpayments or
outpayments of official reserves, it must have a:
14. If a nation has a current account deficit and it does not have to make any inpayments or
outpayments of official reserves, it must have a:
Chapter 21 - The Balance of Payments, Exchange Rates, and Trade Deficits
15. In the U.S. balance of payments, foreign purchases of assets in the United States are a:
16. In the U.S. balance of payments, U.S. purchases of assets abroad are a(n):
17. Which of the following combinations is plausible, as it relates to a nation's balance of
payments?
Chapter 21 - The Balance of Payments, Exchange Rates, and Trade Deficits
18. Which of the following combinations is plausible, as it relates to a nation's balance of
payments?
19. There must always be a balance of a nation's:
20. Which of the following would contribute to a United States balance of payments surplus?
Chapter 21 - The Balance of Payments, Exchange Rates, and Trade Deficits
21-8
21. Which of the following would contribute to a United States balance of payments deficit?
22. Evidence of a chronic balance of payments deficit is:
The following table contains hypothetical data for the 2010 U.S. balance of payments.
Answer the question on the basis of this information. All figures are in billions of dollars.
Chapter 21 - The Balance of Payments, Exchange Rates, and Trade Deficits
23. Refer to the above data. The United States has a balance of goods:
24. Refer to the above data. The U.S. balance on goods and services is a:
25. Refer to the above data. The U.S. balance on current account is a:
Chapter 21 - The Balance of Payments, Exchange Rates, and Trade Deficits
26. Refer to the above data. Item (6) indicates that:
27. Refer to the above data. Item (5) indicates:
28. Refer to the above data. The United States' balance on financial account is a:
Chapter 21 - The Balance of Payments, Exchange Rates, and Trade Deficits
29. Refer to the above data. The United States' balance of capital and financial account is a:
30. If a nation's goods exports are $55 billion, while its goods imports are $50 billion, we can
conclude with certainty that this nation has a:
31. It may be misleading to label a trade deficit as unfavorable or adverse because:
Chapter 21 - The Balance of Payments, Exchange Rates, and Trade Deficits
21-12
32. Which of the following is not included in the current account of a nation's balance of
payments?
33. A deficit on the current account:
Answer the question on the basis of the following 2010 balance of payments data (+ and )
for the hypothetical nation of Zabella. All figures are in billions of dollars.
Chapter 21 - The Balance of Payments, Exchange Rates, and Trade Deficits
34. Refer to the above data. Zabella has a balance of trade (goods):
35. Refer to the above data. Zabella's balance on goods and services shows a:
36. Refer to the above data. Zabella's balance on financial account shows a:
Chapter 21 - The Balance of Payments, Exchange Rates, and Trade Deficits
37. Refer to the above data. Zabella's balance on capital and financial account shows a:
38. Refer to the above information. The current account items for Zippo are:
Chapter 21 - The Balance of Payments, Exchange Rates, and Trade Deficits
39. Refer to the above information. The financial account items for Zippo are:
40. Refer to the above information. Zippo has a:
41. Refer to the above information. Zippo has a:
Chapter 21 - The Balance of Payments, Exchange Rates, and Trade Deficits
42. Refer to the above information. Zippo has:
43. Refer to the above information. On the basis of its balance of payments position, and other
things equal, we can expect the international value of Zippo's currency to:
44. In the balance of payments of the United States, U.S. goods imports are recorded as a:
Chapter 21 - The Balance of Payments, Exchange Rates, and Trade Deficits
45. In the balance of payments of the United States, inflows of foreign currencies to the
United States are recorded as:
46. Which one of the following will not directly affect the U.S. balance on current account?
47. Which one of the following, other things equal, will directly alter the United States
balance of trade?
Chapter 21 - The Balance of Payments, Exchange Rates, and Trade Deficits
21-18
48. In a nation's balance of payments, which one of the following items is always recorded as
a positive entry?
49. In 2009, the United States' balance on goods was about:
50. Suppose the balance on the financial account is + $200 billion and the balance on the
capital account is + $2 billion. The size of the current account is:
Chapter 21 - The Balance of Payments, Exchange Rates, and Trade Deficits
21-19
51. Suppose the balance on the financial account is -$300 billion and the balance on the
capital account is +$5 billion. The size of the current account is:
52. Suppose the balance on the current account is +$100 billion and the balance on the capital
account is $1 billion. The balance on the financial account is:
53. Suppose the balance on the current account is +$50 billion and the balance on the capital
account is +$1 billion. The balance on the financial account is:
Chapter 21 - The Balance of Payments, Exchange Rates, and Trade Deficits
54. In the U.S. balance of payments account for a certain year, a positive number in the
financial account means a:
55. With which of the following countries does the United States have its largest goods and
56. A balance-of-payments deficit occurs:
