Ask Question, Ask an Expert

+1-415-315-9853

info@mywordsolution.com

Ask Basic Finance Expert

1) Which of the following would NOT be considered a typical BOP transaction?
Answer:
- Toyota U.S.A. is a Japanese transplant manufacturing cars in the US. Toyota invests to expand its plant.
- A prospective U.S. tourist purchases British Airline ticket to travel to London
- The U.S. subsidiary of European financial giant, Credit Suisse, pays dividends to its parent in Zurich.
- All are exs of BOP transactions.

2) Anaconda Copper Inc. created a subsidiary in Chile last year to mine copper ore. The proportion of net income paid back to the parent company as a dividend would be recorded in the current account subcategory of ________.
Answer:
- goods trade
- income receipts
- current transfers
- services trade

3) A small economy country whose GDP is heavily dependent on trade with the United States could use a (an) ________ exchange rate regime to minimize the risk to their economy that could arise due to unfavorable changes in the exchange rate.
Answer:
- managed float
- pegged exchange rate with the Euro
- independent floating
- pegged exchange rate with the United States

4) A current account deficit is most likely to decrease as a result of an increase in:
Answer:
- Domestic savings.
- Private investment.
- The fiscal budget deficit.
- None of the above.

5) Which of the following correctly identifies exchange rate regimes from less fixed to more fixed?
Answer:
- Independent floating, currency board arrangement, managed float.
- Exchange arrangements with no separate legal tender, currency board arrangement, crawling pegs.
- Independent floating, crawling pegs, exchange arrangements with no separate legal tender.
- Independent floating, currency board arrangement, crawling pegs.

6) Assume that Z-Land is and open economy and domestic absorption exceeds domestic production. Assuming that unilateral transfers and net income flows are negligible for Z-Land, which one of the following can be concluded with precision (i.e. is absolutely true under all circumstances)?
Answer:
- Z-Land has a public sector deficit.
- Z-Land has a current account surplus.
- Z-Land has a deficit in capital account.
- Z-Land imports more goods and services than it exports.
- None of the above

7) Which of the following is least likely a component of the current account?
Answer:
- Unilateral transfers
- Payments for fixed assets
- Payments for goods and services
- None of the above

8) Patent fees and legal services are recorded in which of the following balance of payments components?
Answer:
- Capital account
- Current account
- Financial account
- Official reserves account

9) The sale of mineral rights would be captured in which of the following balance of payments components?
Answer:
- Capital account
- Current account
- Financial account
- Official reserves account

10) A decline in the US domestic savings (ceteris paribus) is expected to ___________ US current account deficit.
Answer:
- reduce
- increase
- have no impact on
- none of the above

11) The authors discuss the concept of the "Impossible Trinity" or the inability to achieve simultaneously the goals of exchange rate stability, full financial integration, and monetary independence. If a country chooses to have a pure float exchange rate regime, which two of the three goals is a country most able to achieve?
Answer:
- full financial integration and monetary independence
- exchange rate stability and full financial integration
- a country cannot attain any of the exchange rate goals with a pure float exchange rate regime.
- monetary independence and exchange rate stability

12) The post WWII international monetary agreement that was developed in 1944 is known as the ________.
Answer:
- Bretton Woods Agreement
- United Nations
- Yalta Agreement
- League of Nations

13) Private Savings 300bn
Private Investments 310bn
Government Revenues 400bn
Government Expenditures 430bn
Net Statistical Discrepancy -10bn
Net Change in Reserves +20bn
Answer
- 120bn
- 60bn
- 70bn
- 50bn
- none of the above

14) Which one of the following is not a problem with the pegged exchange rates
Answer:
- Pegged exchange rate regimes require substantial reserve holdings
- A peg set at an overvalued exchange rate might lead to a run on reserves
- A peg set at an undervalued exchange rate might impose fiscal costs or might lead to expansion of monetary base creating inflation
- Higher costs incurred on sterilization than the returns earned on reserves
- None of the above

15) A currency peg set at an undervalued rate, is not likely to lead to:
Answer:
- Current account surplus
- Central bank intervention to purchase oversupplied foreign currency
- Sterilization to prevent inflation
- Sale of foreign currency to maintain the peg

Basic Finance, Finance

  • Category:- Basic Finance
  • Reference No.:- M925220

Have any Question? 


Related Questions in Basic Finance

One bond in forest inc has 9 years to maturity and a coupon

One bond in Forest, Inc., has 9 years to maturity and a coupon of 4.2%. The coupon is paid semiannually. If the YTM is 6%, what is the value of the bond? Marcia Food Company has a bond with 15 years to maturity and a cou ...

Find data to decide whether to open a store-you have been

Find data to decide whether to open a store:- You have been asked to determine the feasibility of opening a frozen yogurt store in Greenville, North Carolina. Answer the following questions, using the latest figures avai ...

A researcher conducts a 2 times 3 times 2 factorial study

A researcher conducts a 2 × 3 × 2 factorial study with 20 participants in each treatment condition. a. If the researcher uses an exclusively between-subjects design, how many individuals participate in the entire study? ...

You purchased a new car for 23000 to purchase the car you

You purchased a new car for $23,000. To purchase the car you have a loan with payments of $509.09 monthly for four years. What is the monthly interest rate on this loan? What is the nominal annual interest rate on this l ...

1 what are the four basic goals of behavioral research2

1. What are the four basic goals of behavioral research? 2. Distinguish between basic and applied research. In what ways are basic and applied research interdependent?

In addition to the key words you should also be able to

In addition to the key words, you should also be able to define the following terms: within-subjects design repeated-measures design participant attrition history maturation instrumentation testing effects statistical re ...

1 why is a loan for a condominium more difficult to analyze

1. Why is a loan for a condominium more difficult to analyze than one for a free-standing house? 2. Distinguish between a survey and a legal description. 3. Give an example of a physical characteristic of a house that co ...

In april 2010 christina romer who was then serving as chair

In April 2010, Christina Romer, who was then serving as chair of the President's Council of Economic Advisers, argued: "The overwhelming weight of the evidence is that the current very high-and very disturbing-levels of ...

Accounting statements can be manipulated please try to give

Accounting statements can be manipulated. Please try to give an argument pro and con on this ethical issue. Any actual public examples you would like to cite would be most appreciated by all. Scenario: Many brokerage fir ...

Listed below is a list of how long it takes for bands on

Listed below is a list of how long it takes for bands on stage to complete their first song (in seconds). 538 312 327 309 344 313 318 315 325 331 312 314 What is the mean time it takes for bands on stage to complete thei ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

Section onea in an atwood machine suppose two objects of

SECTION ONE (a) In an Atwood Machine, suppose two objects of unequal mass are hung vertically over a frictionless

Part 1you work in hr for a company that operates a factory

Part 1: You work in HR for a company that operates a factory manufacturing fiberglass. There are several hundred empl

Details on advanced accounting paperthis paper is intended

DETAILS ON ADVANCED ACCOUNTING PAPER This paper is intended for students to apply the theoretical knowledge around ac

Create a provider database and related reports and queries

Create a provider database and related reports and queries to capture contact information for potential PC component pro

Describe what you learned about the impact of economic

Describe what you learned about the impact of economic, social, and demographic trends affecting the US labor environmen