Differentiate between the current account balance and the capital account balance.
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The current account balance includes international purchases and sales of goods and services, cross-border interest and dividend payments, and cross-border gifts to and from both private individuals and governments. The capital account balance includes purchases and sales of financial assets to and from citizens and companies of other countries.
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The expenditure-based method of national accounting ________
A) only tracks the purchase of goods and services by firms B) does not track the purchase of investment goods by firms and households C) only tracks the purchase of goods and services by the government D) tracks the purchase of all goods by households, firms and the government
Refer to Figure 4.2. The income effect on the quantity of clothing purchased is:
A) the change from C1 to C3. B) the change from C1 to C2. C) the change from C2 to C3. D) the change from C3 to C2. E) none of the above
How will increased usage of the Internet by employers and employees influence the job search process?
a. It will make job-related information more costly and, therefore, tend to increase the rate of unemployment. b. It will make job-related information less costly and, therefore, tend to increase the rate of unemployment. c. It will make job-related information more costly and, therefore, tend to reduce the rate of unemployment. d. It will make job-related information less costly and, therefore, tend to reduce the rate of unemployment.
Explain the concept of scale economies. Explain the difference between internal and external scale economies. What pattern of trade do we expect to see in industries with substantial external scale economies?
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