EBK ECONOMICS FOR TODAY
9th Edition
ISBN: 8220101414250
Author: Tucker
Publisher: Cengage Learning US
expand_more
expand_more
format_list_bulleted
Question
Chapter 28, Problem 13SQ
To determine
The capital account.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solutionStudents have asked these similar questions
The record of a country's transactions in goods, services, and assets with the rest of the world is itsĀ Ā Ā Ā Ā
A) balance of trade account. B) current account.
C) capital account.Ā Ā Ā Ā Ā D) balance of payments account
Examine the summary of the balance of payments of the United States for 2021. Compute and discuss the balance on the current account and its subaccounts. A Summary of the U.5. Balance of Payments for 2021 (in $ billion) Credits Debits Current Account [1] Exports $ 2,596.0 [1.1] Goods 1, 683.0 [1.2] Services 913.0 [2] Imports-53,374.7 [2.1] Goods-2, 663.6 [2.2] Services -711.1 [3] Primary Income 1,214.9-953.0 [4] Secondary income 219.2-376.9 Balance on current account [[1]+[2]+[3]+[4]-674.5 Capital Account 1.3-15.5 Balance on capital account -14.2 Financial Account (excluding official reserves) [5] Direct investment 392.2-182.2 [6] Portfolio investiment 308.9 13.5 [6.1] Equily securities -304.1 223 4 [6.2] Deht securities 481.3-209.9 [6.3] Derivatives, net 131.7 [7] Other Investment 456.4-263.6 Balance on financial account [[5]+[6]+[7]] 725.2 [8] Statistical discrepancies -3.0 Overall balance 33:5 Official Reserve Account -33.5 Source: The U.S. Bureau of Economic Analysis Required: a1.ā¦
What is the relationship between the current account and the capital account in the balance of payments?
Select one:
a.
The current account shows all income and expenditure and the capital account shows investment and how it is funded.
b.
The capital account shows how a current account deficit is funded or a surplus is disbursed.
c.
There is no relationship between them as they measure different things.
d.
The current account balance is the difference between exports and imports and the capital account balance shows net foreign income.
Chapter 28 Solutions
EBK ECONOMICS FOR TODAY
Ch. 28.4 - Prob. 1GECh. 28.6 - Prob. 1GECh. 28 - Prob. 1SQPCh. 28 - Prob. 2SQPCh. 28 - Prob. 3SQPCh. 28 - Prob. 4SQPCh. 28 - Prob. 5SQPCh. 28 - Prob. 6SQPCh. 28 - Prob. 7SQPCh. 28 - Prob. 8SQP
Ch. 28 - Prob. 9SQPCh. 28 - Prob. 10SQPCh. 28 - Prob. 11SQPCh. 28 - Prob. 1SQCh. 28 - Prob. 2SQCh. 28 - Prob. 3SQCh. 28 - Prob. 4SQCh. 28 - Prob. 5SQCh. 28 - Prob. 6SQCh. 28 - Prob. 7SQCh. 28 - Prob. 8SQCh. 28 - Prob. 9SQCh. 28 - Prob. 10SQCh. 28 - Prob. 11SQCh. 28 - Prob. 12SQCh. 28 - Prob. 13SQCh. 28 - Prob. 14SQCh. 28 - Prob. 15SQCh. 28 - Prob. 16SQCh. 28 - Prob. 17SQCh. 28 - Prob. 18SQCh. 28 - Prob. 19SQCh. 28 - Prob. 20SQ
Knowledge Booster
Similar questions
- The GDP for the United States is 18,036 billion and its current account balance is 484 billion. What percent of GDP is the current account balance?arrow_forwardDo all international financial transactions involve exchanging one currency for another? Could a nation that neither imports nor exports goods and services still engage in international financial transactions? Explain: āU.S. exports earn supplies of foreign currencies that Americans can use to finance imports.āarrow_forwardAll of the following are surplus items on a country's balance of payments EXCEPT a. gold sales to foreigners. b. exports. c. foreign tourists expenditures in the host country. d. purchase of foreign assets.arrow_forward
- The capital account on the United States' balance of payments includes ALL BUT WHICH of the following transactions?Ā a. Changes in ownership of foreign stocks. b. The sale of U.S. automobiles to German consumers. c. Foreign investors construct a factory on U.S. soil. d. The purchase of U.S. bones by a foreign government. e. A U.S. firm buys property in a foreign country.arrow_forwardThe balance of payments of a country on current account is equal to ___________. Select one: a.Ā balance of trade plus short term b.Ā balance of trade plus net invisible exports c.Ā balance of invisible trade plus imports d.Ā balance of payment minus capital flowsarrow_forwardUnder a system of flexible exchange rates, what will correct a deficit in a country's balance of payments? Ā a. an appreciation in the nation's currency Ā Ā b. a decline in the nationās domestic price level Ā Ā c. a depreciation in the nation's currency Ā Ā d. an increase in the nationās inflation rate Ā 2. Which of the following would supply Canadian dollars to the foreign exchange market? Ā a. an increase in the number of Canadians going to Las Vegas over the holidays Ā Ā b. an increase in spending due to American tourists in Canada Ā Ā c. the sale of a Canadian corporation to a German investor Ā Ā d. the sale of wheat from Manitoba to a European bakeryarrow_forward
- 1. Which of the following falls under the current account of the Philippines? a. The value of the Philippines' export of goods increased due to the increase in demand from China. b. The value of the Philippines' import of goods increased due to a high domestic demand for raw materials. c. Both a and b d. None of the above 2. What is the difference between current account and financial account? a. Current account measures the difference between import and export while financial account measures sales of import and export. b. Current account measures transactions that do not create liabilities while financial account measures those that do. c. Current account measures transactions that create liabilities while financial account measures those that don't. d. None, they are the same. 3. Which of the following statements is correct? a. There is trade surplus when import equals export. b. There is trade surplus when export equals import. c. There is trade deficit when export is greater thanā¦arrow_forwardThe following information on Ghanaās Balance of Payments Accounts for 2013 (million U.S.Ā Ā Ā Ā Ā Ā Ā Ā Dollars) is provided. CURRENT ACCOUNT US$ 1.Ā Ā Ā Ā Ā Ā Merchandise Exports ( Ā£.o.b) 11,679.40 2.Ā Ā Ā Ā Ā Ā Merchandise Imports (Ā£.o.b) -16,092.50 Trade balance Ā Ā -4,413.1 3.Ā Ā Ā Ā Ā Ā Services (net) Ā Ā -2,346.84 Ā Receipts Ā Ā Ā Ā 3,539.40 Ā Payments Ā Ā Ā -5,886.24 4.Ā Ā Ā Ā Ā Ā Income (net) Ā Ā Ā Ā Ā 4,155.98 Receipts Ā Ā Ā Ā Ā Ā Ā -592.96 Ā Payments Ā Ā Ā Ā Ā Ā Ā Ā Ā 202.24 5.Ā Ā Ā Ā Ā Ā Current Transfers (net) Ā Ā Ā Ā Ā Ā Ā Ā Ā 795.20 Ā CAPITAL & FINANCIAL ACCOUNT Ā 6.Ā Ā Ā Ā Ā Ā Capital Account Ā Ā Ā Ā Ā Ā Ā Ā 1,127.78 Ā Capital Transfers Ā Ā Ā Ā Ā Ā Ā Ā Ā 1,127.78 7.Ā Ā Ā Ā Ā Ā Financial Account Ā Ā Ā Ā Ā Ā Ā Ā Ā Ā Direct Investments Ā Ā Ā Ā Ā Ā Ā Ā Ā 3,355.68 Portfolio Investments Ā Ā Ā Ā Ā Ā Ā Ā Ā Ā Ā Ā Ā Ā -87.28 Other Investments Ā Ā Ā Ā Ā Ā Ā Ā Ā Ā 1,737.96 Ā Ā Ā Of which: Ā Ā Short term capital Ā Ā Ā Ā Ā Ā Ā Ā Ā Ā Ā Ā Ā -164.12 Ā Other capital investments Ā Ā Ā Ā Ā Ā Ā Ā Ā Ā Ā 2,172.40ā¦arrow_forwardThe following information on Ghanaās Balance of Payments Accounts for 2013 (million U.S.Ā Ā Ā Ā Ā Ā Ā Ā Dollars) is provided. CURRENT ACCOUNT US$ 1.Ā Ā Ā Ā Ā Ā Merchandise Exports ( Ā£.o.b) 11,679.40 2.Ā Ā Ā Ā Ā Ā Merchandise Imports (Ā£.o.b) -16,092.50 Trade balance Ā Ā -4,413.1 3.Ā Ā Ā Ā Ā Ā Services (net) Ā Ā -2,346.84 Ā Receipts Ā Ā Ā Ā 3,539.40 Ā Payments Ā Ā Ā -5,886.24 4.Ā Ā Ā Ā Ā Ā Income (net) Ā Ā Ā Ā Ā 4,155.98 Receipts Ā Ā Ā Ā Ā Ā Ā -592.96 Ā Payments Ā Ā Ā Ā Ā Ā Ā Ā Ā 202.24 5.Ā Ā Ā Ā Ā Ā Current Transfers (net) Ā Ā Ā Ā Ā Ā Ā Ā Ā 795.20 Ā CAPITAL & FINANCIAL ACCOUNT Ā 6.Ā Ā Ā Ā Ā Ā Capital Account Ā Ā Ā Ā Ā Ā Ā Ā 1,127.78 Ā Capital Transfers Ā Ā Ā Ā Ā Ā Ā Ā Ā 1,127.78 7.Ā Ā Ā Ā Ā Ā Financial Account Ā Ā Ā Ā Ā Ā Ā Ā Ā Ā Direct Investments Ā Ā Ā Ā Ā Ā Ā Ā Ā 3,355.68 Portfolio Investments Ā Ā Ā Ā Ā Ā Ā Ā Ā Ā Ā Ā Ā Ā -87.28 Other Investments Ā Ā Ā Ā Ā Ā Ā Ā Ā Ā 1,737.96 Ā Ā Ā Of which: Ā Ā Short term capital Ā Ā Ā Ā Ā Ā Ā Ā Ā Ā Ā Ā Ā -164.12 Ā Other capital investments Ā Ā Ā Ā Ā Ā Ā Ā Ā Ā Ā 2,172.40ā¦arrow_forward
- Explain 3 factors why countries would want to join a Single Currency area.arrow_forward1. A. Calculate the current account for U.S. based on the following data for 2018. Export of goods and services $270, Import of goods and services $230, Foreign aids and grants received $120, Foreign aids and grants provided $63, Investment by U.S. companies in foreign countries for establishing subsidiaries $550, Interest and dividend received by U.S $90, investment by foreigners in US companies' bonds and stocks $50. All numbers are in billions of dollars. b. Is U.S. running a deficit or surplus on current account balance, explain in 1 - 2 meaningful sentencesarrow_forwardExamine the following table: Ā Value of Exports (in billions) Value of Imports (in billions) Balance Goods $100 $200 -$100 Services $150 $100 $50 Income Receipts and Payments $300 $200 $100 Unilateral Transfers $30 $60 -$30 Ā $580 $560 $20 The data highlighted in the last row of the table represent the: A) Export-Import Balance B) Current Account Balance C) Income Balance D) Merchandise Trade Balancearrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- Principles of Economics 2eEconomicsISBN:9781947172364Author:Steven A. Greenlaw; David ShapiroPublisher:OpenStaxExploring EconomicsEconomicsISBN:9781544336329Author:Robert L. SextonPublisher:SAGE Publications, Inc
Principles of Economics 2e
Economics
ISBN:9781947172364
Author:Steven A. Greenlaw; David Shapiro
Publisher:OpenStax
Exploring Economics
Economics
ISBN:9781544336329
Author:Robert L. Sexton
Publisher:SAGE Publications, Inc