1. The US has a _________________ because foreigners invest more in the US than we invest in foreign countries.

a. Current Account Surplus

b. Current Account Deficit

c. Capital Account Surplus

d. Capital Account Deficit

2. Which of the following is NOT given as a reason for merger activity in the U.S.?

a. Synergistic benefits arising from mergers.

b. Increased market power and a reduction in competition resulting from mergers.

c. Attempts to stabilize earnings through diversification.

d. Making an acquisition tends to increase the acquiring company's stock price.