1. Which of the following would increase the U.S. financial account? a factory s
ID: 1161249 • Letter: 1
Question
1. Which of the following would increase the U.S. financial account? a factory site purchased in Ireland by an American businessman. a sailboat purchased by a wealthy Japanese entrepreneur. $500 in interest earned on foreign stocks. the purchase of $500 of American bonds by a German investor. the purchase of an American car by a diplomat living in Jamaica. 2. Suppose interest rates fall in the United States, but they don't fall in Morocco. What is the short-run impact of this change in interest rates on the value of the U.S. dollar (USD), the value of the Moroccan dirham (MAD), and U.S. net exports (based on the changing value of the dollar)?USD / MAD / Net Exports Appreciate / Depreciate / Increase Appreciate / Depreciate / Decrease Depreciate / Depreciate / Increase Depreciate / Appreciate / Decrease Depreciate / Appreciate / Increase 1. Which of the following would increase the U.S. financial account? a factory site purchased in Ireland by an American businessman. a sailboat purchased by a wealthy Japanese entrepreneur. $500 in interest earned on foreign stocks. the purchase of $500 of American bonds by a German investor. the purchase of an American car by a diplomat living in Jamaica.
Explanation / Answer
1.option D.
When the German investor purchases $500 from the American bonds from the people in US increases the total holdings of US Assets.
This in turn increases the US financial Account.
2. Option E.
The US dollar depreciates when the interest rates fall in the US.
At the same time the value of morocco dirham appreciates and the net Exports in US increases.
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