Any transaction that causes foreign exchange to enter a country is a
A. debit item in that country's balance of payments.
B. debit item in that country's balance of trade.
C. credit item in that country's balance of payments.
D. credit item in that country's balance of trade.
Answer: C
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In an economy with flexible exchange rates, which measure(s) are successful at reducing unemployment in the context of the Three-Sector-Model?
a. Decrease government spending. b. Increase the discount rate for banks. c. Lower tax rates. d. Increase reserve requirements. e. All of the above
Sales of intermediate goods and services (goods and services purchased for further reprocessing and resale) are excluded from GDP to avoid the problem of double counting, which is counting an item's value more than once
Indicate whether the statement is true or false
A perfectly competitive firm maximizes profits by producing at the point where
A. the distance between price and average total cost is the greatest. B. the distance between price and marginal cost is the greatest. C. price equals marginal cost. D. price equals average total cost.
During the EMS crisis in 1992,
A) all the EMS countries abandoned the system. B) Germany abandoned the system. C) England and Italy abandoned the system. D) France was put in charge of the system. E) all the EMS countries stood firm, and refused to change central parities.