In a nation's balance of payments, the current account includes
A) the changes in the official reserve transaction account.
B) the purchases of foreign assets.
C) the balance of the trade account, the balance of the services account, and net unilateral transfers.
D) all of the above.
Answer: C
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Using the UIP equation, what would happen to the spot rate for euros if the interest rate on U.S. dollar deposits rises ceteris paribus?
a. The spot rate to purchase euros would rise (dollar depreciation). b. The spot rate to purchase euros would fall (dollar appreciation). c. The spot rate to purchase euros would be unchanged. d. The U.S. Federal Reserve would have to raise U.S. short-term interest rates.
The profit-maximizing quantity of the monopolist compared to the perfectly competitive industry in the above figure are, respectively
A. Q1 and Q5. B. Q1 and Q3. C. Q1 and Q2. D. Q2 and Q3.
The points outside the production possibilities frontier are
A) efficient. B) attainable. C) inefficient. D) unattainable.
Starting from long-run equilibrium, a decrease in autonomous investment results in ________ output in the short run and ________ output in the long run.
A. lower; potential B. higher; higher C. higher; potential D. lower; higher