6- purchases of US assets by foreign residents are tabulated in the US balance o

Question

6- purchases of US assets by foreign residents are tabulated in the US balance of payments as a (an): a- capital inflow b- capital outflow c- current account outflow d- unilateral transfer e-imports f- exports 7- suppose a monopolist charges a price corresponding to the intersection of the marginal cost and marginal revenue curves. if this price is between its average variable cost and average total cost curves, the firm will: a- earn an economic profit b- stay in operation in the short run, but shut down in the long run if demand remains the same c- shut down d- none of the above 8- suppose the United States imports wheat from a foreign country, and if the US government levies tariff on wheat imports, the probable result is that the price of wheat will: a- fall in foreign countries b- rise in the United States C- rise in foreign countries d- rise faster in the United States than in foreign countries 9- which of the following are the same at all levels of output under perfect competition? a- marginal cost and marginal revenue b- price and marginal revenue e- price and marginal cost d- all of the above 10- which of the following is true for the a- economic profit is possible in the long run b- marginal revenue is less than the price charged c- profit maximizing or loss minimizing occurs when marginal revenue equals marginal cost d-all of the above are truc e- none of the above is true 11- which of the following would cause a decrease in the demand for euros by those holding US dollars? a- inflation in the United States, but not in France b- inflation in France, but not in the United States c-an increase in the real rate of interest on investment in France above the real rate of interest on investment in the United States d- none of the above

Explanation / Answer

6)f) exports.   The BOP for United States international transactions is divided into the current account and the capital account. The current account consists of goods, services, and investment earnings. The capital accountconsists of capital transfers and the acquisition and disposal of real and intangible assets, such as real estate or patents. The current account consists of the balance of trade, net primary income or factor income (earnings on foreign investments minus payments made to foreign investors) and net cash transfers, that have taken place over a given period of time. The current account balance is one of two major measures of a country's foreign trade (the other being the net capital outflow). A current account surplus indicates that the value of a country's net foreign assets (i.e. assets less liabilities) grew over the period in question, and a current account deficit indicates that it shrank. SO IT IS CLEAR THAT,THE EXPORTS COMES INCURRENT ACCOUNT OF BOP.

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