Chapter 3 Quiz With Asnwers

Image Analysis Textual Content Smartbook Ch. 3 If a country is experiencing trade deficits year after year, the country's domestic industries may lack international Competitiveness The statistical record of a country's international transactions over a certain period of time presented in the form of double-entry bookkeeping is defined as the Balance of Payments.   Because of double-entry bookkeeping, the sum of all of the items (or entries) in a country's balance of payments must equal Zero In a country's balance of payments statement, a transaction that results in a purchase from foreigners will be recorded as a(n) Debit Which of the following accounts for the export and import of goods and services? The Current Account Information about which of the following can potentially be learned from a country's balance of payments accounts? 1. The country's openness to trade. 2. The country's international competitiveness. 3. The supply and demand for the country's currency. The balance of payments is defined as a flow concept because it's measured Over a period of Image Analysis Textual Content Smartbook Ch. 3 If a country is experiencing trade deficits year after year, the country's domestic industries may lack international Competitiveness The statistical record of a country's international transactions over a certain period of time presented in the form of double-entry bookkeeping is defined as the Balance of Payments.   Because of double-entry bookkeeping, the sum of all of the items (or entries) in a country's balance of payments must equal Zero In a country's balance of payments statement, a transaction that results in a purchase from foreigners will be recorded as a(n) Debit Which of the following accounts for the export and import of goods and services? The Current Account Information about which of the following can potentially be learned from a country's balance of payments accounts? 1. The country's openness to trade. 2. The country's international competitiveness. 3. The supply and demand for the country's currency. The balance of payments is defined as a flow concept because it's measured Over a period of A country's net foreign wealth is increased by account which implies that the country. output than it produced. a current. used up Surplus, Less Because of double-entry bookkeeping, the sum of all of the items (or entries) in a country's balance of payments must equal Zero True False: Capital transfers involve change of ownership or acquisition or disposal of an asset. True The statistical discrepency entry in the balance of payments. Statement is necessary in part because some of the information. used in compiling the statement is Based on different recording methods. Not time synchronized. Inaccurately or falsely reported. For the purpose of preserving the rule, when goods, services, or assets are provided without a corresponding return of something of economic value, the corresponding entry is made as transfer. Double-Entry Bookkeeping. In the long run, exerting tend to be responsive to influences a depreciation, on the trade balance.. Both imports exports Positive The overall balance includes which of the following? The Current Account. The Capital Account The Statistical Discrepancy. If a government wants to see its currency Strengthen weaken, then it would buy assets such as gold and foreign currency with domestic currency and generate a negative entry under official reserves. Weaken The capital account includes capital transfers and acquisitions and disposals of nonproduced and and foreigners. assets between U.S. residents. Nonfinancial Which of the following is correct? The casualty between current account deficit. Surplus flows both ways. • financial account. • Which of the following are categories in the current account? Factor income. Services •Merchandise trade • Unilateral transfers Originally applied to countries that accumulated precious metals, the theory that a continuing trade surplus should be a policy goal known as is Mercantilism In a(n) floating exchange rate. system, central banks. discreetly buy and sell foreign exchanges with the result that the Overall balance is indeterminate. Dirty