If the current account balance is $235 billion and U.S. official reserves increased by $35 billion, what is the official settlements account balance and the capital account balance?
What will be an ideal response?
The official settlements account equals the negative of the change in official reserves, so the official settlements account balance is -$35 billion. Then, the sum of the current account balance plus the capital account balance plus the official settlements account balance equals zero, which means that the capital account balance must equal $200 billion.
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If barbers in Mexico are just a productive as their counterparts in the United States then why do they earn lower wages?
What will be an ideal response?
Credit cards are:
a. M1 money. b. M2 money. c. near money. d. not money.
Fundamental analysis shows that Quadrangle Company is fairly valued. Then Quadrangle Company unexpectedly improves its production techniques and unexpectedly hires a new CEO away from another very successful competitor. Suppose this has no effect on the price of the stock of Quadrangle Company
a. Fundamental analysis would now show the corporation is overvalued. The fact that the price was unchanged is consistent with the efficient markets hypothesis. b. Fundamental analysis would now show the corporation is overvalued. The fact that the price was unchanged is not consistent with the efficient markets hypothesis. c. Fundamental analysis would now show the corporation is undervalued. The fact that the price was unchanged is consistent with the efficient markets hypothesis. d. Fundamental analysis would now show the corporation is undervalued. The fact that the price was unchanged is not consistent with the efficient markets hypothesis.
An optimal corrective tax levied on polluters will:
A. not generate enough revenue to pay for the cost of the damage resulting from pollution that occurs at the efficient output of the good. B. decrease pollution to zero. C. be equal to the marginal cost of their actions imposed on third parties. D. increase the supply of polluting goods.