What are the three categories of transactions in the balance of payments? Give an example of each
The current account includes records of the trade of goods and services, investment income, and unilateral transfers. The purchase of American machinery by a foreign firm is recorded here. The capital account records changes in the ownership of real and financial assets. The sale of IBM stock to a foreign investor is recorded here. The official reserve account records changes in currency holdings of the central bank. If the United States reduces its currency holdings by supplying foreign currency to the foreign exchange market, this transaction is recorded in the official reserve account..
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Due to Pigou's "defective telescopic faculty," a market economy is inefficient in allocating resources between the present and the future
a. True b. False Indicate whether the statement is true or false
In examining the national income accounts of the closed economy of Nepotocracy you see that this year it had taxes of $100 billion, transfers of $20 billion, and government purchases of goods and services of $70 billion. You also notice that last year it had private saving of $70 billion and investment of $50 billion. In which year did Nepotocracy have a budget deficit of $20 billion?
a. this year and last year b. this year but not last year c. last year but not this year d. neither this year nor last year
Refer to the figure below. This graph suggests that the private market provides incentives to:
A. over-price paper relative to the social optimum. B. eliminate the externalities generated by paper production. C. under-produce paper relative to the social optimum. D. over-produce paper relative to the social optimum.
What is the marginal net benefit of producing the fourth unit?No. units producedTotal RevenueTotal costs0001100502180110325018042902705310380
A. 40 B. -50 C. 60 D. 0