In a small open economy, if exports equal $5 billion and imports equal $7 billion, then there is a trade and net capital outflow. deficit; positive deficit; negative surplus; positive surplus; negative
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- In an open economy, if exports equal $8 billion and imports equal $3 billion, then there is a trade ______ and ______ net capital outflow. Group of answer choices deficit; positive deficit; negative surplus; positive surplus; negativeSuppose that in the country of Mistania, investment spending increases from $1740 to $1940. There is no change in Mistania's private or public savings. According to the national saving and investment identity, what happens to the trade balance as investment spending increases? OTrade deficit goes up OTrade deficit goes down Ostays the sameNet exports and net capital outflow: 1. Which of the following statements about a country with a trade deficit is not true? Why? A. exports < imports B.net capital outflow < 0 C.investment < saving
- In 2019 Country A had a current account deficit of $1.2 billion. CountryA's capital account was in a $100 million surplus. In addition, CountryA's factors of production located in foreign countries earned $600 million.Country A had a trade deficit of $800 million. Assume Country A neithergave nor received unilateral transfers. Country A's GDP was $9 billion. Answer the following questions about Country A in 2019. and show your work. i) compute net factor income from abroad of Country A. ii) How much income did foreign factors of production earn in CountryA? iii) Compute Country A's GNE and GNI.Assuming that a country has a trade deficit of $50 billion, which of the following is true: A. The country's exports are $120 billion and its imports are $180 billion B. The country's exports are $100 billion and its exports are $150 billion c. The country's imports are $120 billion and its exports are $180 billion d. The country's exports are $150 billion and its imports are $100A government official announces a new policy. Thecountry wishes to eliminate its trade deficit, but willstrongly encourage financial investment from foreignfirms. Explain why such a statement is contradictory.
- How does a growing trade deficit affect a country's GDP? Explain your answer.Suppose the government share of GDP is 20 percent and the consumption, investment, and net export shares of GDP are 60, 15, and 5 percent, respectively. If the dollar exchange rate increases, then we would expect the government share of GDP to increase. the interest rate to decrease. the interest rate to increase. the government share of GDP to decrease. the net export share of GDP to increase. OOOA country finds itself in the following situation: a government budget deficit of $700; total domestic savings of $1470, and total domestic physical capital investment of $2100. According to the national saving and investment identity, what is the current account deficit?
- Suppose a country exports $60 million worth of goods and services, while it imports $50 million worth of goods and services. This country has a trade deficit and negative capital inflow. has a trade deficit and a postive capital inflow. has a trade surplus and negative capital inflow. has a trade surplus and a positive capital inflow.If a country imports more than it exports, it has a trade deficit. True or falseQ3-14 If a country's currency's external value is tied or pegged to the currency values of the country's leading trading partners, this arrangement is known as a Select one: a. peg against the SDR. b. managed float. c. peg against a "basket" of currencies or a "composite." d. currency board.