Are rapidly growing countries likely to have a financial account surplus or deficit? Why?
Are rapidly growing countries likely to have a financial account surplus or deficit? Why?
Homework Answers
Such a country is more likely to have a financial account surplus.
When a country has a financial account surplus, foreign buyers are buying more domestic assets than the domestic buyers are buying foreign assets. When a country is rapidly growing, foreign investors are more interested in buying the assets in the country because of the high growth and high potential returns.
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Are rapidly growing countries likely to have a financial account
surplus or deficit? Why?
If a country runs a surplus in financial account, its current account has a deficit. True,...
If a country runs a surplus in financial account, its current account has a deficit. True, false, or uncertain? Explain.
Suppose a country has a current account surplus of $8 billion, but a financial account deficit...
Suppose a country has a current account surplus of $8 billion, but a financial account deficit of $5 billion. a) Is its balance of payments a deficit, surplus or neither? The balance of payments is (select one). b) What change in official exchange reserves would you see? Note: Keep $0 for the second part if you think there is no change. The official exchange reserves would (select one) by $0 billion. c) Is the central bank buying or selling foreign...
Explain the term Financial Account deficit, and give two reasons why a country may have such...
Explain the term Financial Account deficit, and give two reasons why a country may have such a deficit.
Suppose that a certain country has a current account surplus in its balance of payments. Does...
Suppose that a certain country has a current account surplus in its balance of payments. Does this mean that the country will necessarily have a financial account deficit? Explain why or why not.
Classify the countries according to the sign of each countries' current account balance in 2012. Current...
Classify the countries according to the sign of each countries' current account balance in 2012. Current account surplus Current account deficit Answer bank: United States China Canada Germany United Kingdom Japan
What is deficit bias and what are it’s causes? Why might deficit bias vary across countries?...
What is deficit bias and what are it’s causes? Why might deficit bias vary across countries? Propose and explain any two measures for tackling deficit bias.
and interest rates are 39. In countries with rapidly growing economies, like China and India, the...
and interest rates are 39. In countries with rapidly growing economies, like China and India, the demand for loanable funds is than in countries with slowly growing economies. smaller; higher larger; lower smaller; lower O larger; higher 40. Capital tends to: flow toward countries with high political risk. ignore political risk in the current time frame. flow toward countries with low political risk. O ignore political risk and focus on returns. 42. When the value of a pound sterling changes...
Describe the impact a rapidly growing economy can have on families.
Describe the impact a rapidly growing economy can have on families.
Assume that there are only three countries in the world: Amazonia, Babylonia and Carthaginia. Amazonia has...
Assume that there are only three countries in the world: Amazonia, Babylonia and Carthaginia. Amazonia has a current account deficit of 20 and Babylonia has a financial account surplus of 30. a. Calculate Amazonia’s financial account and Babylonia’s current account. b. Calculate Carthaginia’s financial account and current account.
20A trade balance where exports exceed imports is called: trade surplus. trade deficit. budget deficit. none...
20A trade balance where exports exceed imports is called: trade surplus. trade deficit. budget deficit. none of the above. 21Capital flows deal with: buying and selling of newly produced final goods and services among countries. buying and selling of existing real and financial assets among countries. buying and selling of only domestic final goods and services. none of the above. 22Potential GDP is: minimum amount of output that can be produced given the labor force, capital stock, and technology. maximum...
Suppose a country has a current account surplus of $8 billion, but a financial account deficit of $5 billion. a) Is its balance of payments a deficit, surplus or neither? The balance of payments is (select one). b) What change in official exchange reserves would you see? Note: Keep $0 for the second part if you think there is no change. The official exchange reserves would (select one) by $0 billion. c) Is the central bank buying or selling foreign...
and interest rates are 39. In countries with rapidly growing economies, like China and India, the demand for loanable funds is than in countries with slowly growing economies. smaller; higher larger; lower smaller; lower O larger; higher 40. Capital tends to: flow toward countries with high political risk. ignore political risk in the current time frame. flow toward countries with low political risk. O ignore political risk and focus on returns. 42. When the value of a pound sterling changes...
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