Exam 10: The Balance-of-payments

Over its history,suppose that France has borrowed more from the rest of the world than it has lent to the rest of the world.This means that France

In recent years,______ has been the world's largest international debtor

If a country consistently realizes a current-account surplus in its balance of payments,it likely will become a "net debtor" in its balance of international indebtedness.

If Japanese investors purchase Treasury Bills of the U.S.government,this results in a

Services transactions on Canada's balance-of-payments statement would include Canadian ships transporting lumber to Japan,foreign tourists spending money in Canada,and Canadian engineers designing bridges in China.

For the United States,a loss in its reserve currency position would likely result in several costs,including All of the above

Because the balance of payments utilizes double-entry accounting,merchandise exports will always be in balance with merchandise imports.

Because the balance of payments is a record of the economic transactions of a country over a period of time,it is a "flow" concept.

The net-debtor status,that the United States achieved in its balance of international indebtedness by the mid-1980s,reflected the continuous current-account surplus that the United States attained in its balance of payments during the 1970s.

Reducing a current account deficit requires a country to:

Which balance-of-payments item does not directly enter into the calculation of the U.S.gross domestic product?

On the balance-of-payments statement,a capital inflow can be likened to the import of goods and services.

If Toyota Inc.of Japan builds an automobile assembly plant in the United States,the Japanese capital account would register an outflow.

The United States realizes several benefits from the dollar serving as the main reserve currency of the world,including

On the balance-of-payments statement,dividend and interest income are classified as capital-account transactions.

Because a large number of international transactions fail to get recorded,statisticians insert a residual,known as statistical discrepancy,to ensure that total debits equal total credits.