Looking at the U.S. balance of payments for the last two decades, how have the current account and the capital account changed?
What will be an ideal response?
Since the early 1980s and onward, the U.S. current account has been negative and sometimes quite large. The U.S. capital account has more or less mirrored the current account, only it has been positive rather than negative. Thus when the current account deficit is small, the capital account surplus is small and when the current account deficit is large, the capital account surplus is large.
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Between 1950 and 2015 the productivity of wheat farmers in the United States more than doubled. This means that
A) the total amount of wheat produced more than doubled. B) the amount of land and other resources devoted to wheat production more than doubled. C) the amount of wheat produced by the average farmer more than doubled. D) the incomes of wheat farmers more than doubled.
Suppose the market demand curve (D) in an oligopoly market characterized by a dominant firm and a fringe is given by Q = 25 - 2P. The fringe supply curve is given by QF = -1 + 0.3P. If the marginal cost of production for the dominant is $3, calculate the market price and total output produced by the dominant firm and the fringe
a. Q = 14.42 units and P = $8.64 b. Q = 10.69 units and P = $7.15 c. Q = 12.69 units and P = $6.5 d. Q = 8.74 units and P = $5.15
In the long run, a year-long drought that destroys most of the summer's wheat crops causes permanently:
A. higher prices. B. lower prices. C. lower output. D. None of these is true.
Developing countries do:
A. compete with one another for foreign investment, and this competition reduces the benefits from foreign investment. B. not compete with one another for foreign investment, because they have sufficient domestic saving to finance their investment needs. C. not compete with one another for foreign investment, because they lack the infrastructure to attract it in the first place. D. compete with one another for foreign investment, but this competition is beneficial to developing countries because it insures a more efficient allocation of resources.