Remittances of Mexican workers in the U.S. to their families in Mexico are included in the U.S. balance of payments as a debit in the section on 

trade in services.

net international transfers.

financial accounts.

capital accounts.

Question 2. 2.(TCO 9) A trade deficit means a net 

inflow of payments for goods and services.

outflow of goods and services.

inflow of goods and services.

excess of exports over imports.

Question 3. 3.(TCO 9) If an American can purchase 40,000 British pounds for $90,000, the dollar rate of exchange for the pound is 

$0.44.

$0.23.

$2.25.

$2.00.

Question 4. 4.(TCO 9) When the exchange rate between pounds and dollars moves from $2 = 1 pound to $1 = 1 pound, we say that the dollar has 

depreciated.

appreciated.

inflated.

deflated.

Question 5. 5.(TCO 9) The monetary system for conducting international trade is usually described as a system of 

fixed exchange rates.

freely floating exchange rates.

a managed gold standard.

managed floating exchange rates.

Question 6. 6.

(TCO 8) a) Explain four problems with the argument that trade protection is needed to protect American jobs. b) Describe the economic reasons why businesses use offshoring.

Question 7. 7.

(TCO 6) a) Explain the tools used to pursue expansionary and contractionary fiscal policy. During which phases of the business cycle would each be appropriate b) Explain what is meant by a built-in stabilizer and give two examples.