The balance of payments equals
A. the sum of the current account and the financial account.
B. the net increase (domestic less foreign) in a country's official reserve assets.
C. net investment income from abroad.
D. the current account minus net unilateral transfers.
Answer: B
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Which of the following correctly describes a way in which deficit spending can impose a burden on future generations? I
Failure to allocate deficit spending to uses that boost future real Gross Domestic Product (GDP) will require taxing future generations at a higher rate to repay the resulting higher public debt. II. Government deficits that lead to higher employment and real Gross Domestic Product (GDP) in the future will generate increased income taxes for future governments, which will respond by spending the higher tax revenues, creating higher future government budget deficits. III. Other things being equal, deficit spending fuels increased consumption of goods and services by the current generation that crowds out capital investment, thereby leaving future generations with a smaller stock of capital than otherwise would have existed. A) I only B) II only C) I and III only D) II and III only
A country can have a negative balance of trade and a positive balance of goods and services
a. True b. False Indicate whether the statement is true or false
A decrease in the price level causes a lower equilibrium quantity demanded
a. True b. False Indicate whether the statement is true or false
A reduction in net exports shifts the aggregate
a. demand curve inward. b. demand curve outward. c. supply curve outward. d. supply curve inward.