Exam 14: Macroeconomics and International Trade

If foreigners held U.S.assets worth $200 billion during a certain year and the current account balance for that year was −$189 billion,the total volume of foreign assets held domestically was worth ________.

Remittances to foreign countries from legal and illegal residents of the United States are examples of ________.

Technical support provided by an Indian firm to a multinational company headquartered in New York is an example of a(n)________.

Explain how the gains from comparative advantage are realized.

Scenario: There are two workers in a factory that produces two goods, Good X and Good Y. Worker 1 adds a value of $200 per hour in the production of Good X and a value of $100 per hour in the production of Good Y. Worker 2 adds a value of $125 per hour in the production of Good X and a value of $87.50 per hour in the production of Good Y. -Refer to the scenario above.Which of the following is true in this case?

Scenario: A shoe manufacturer has factories in two countries, Country X and Country Y. Shoe manufacturing involves two main tasks-designing the shoe and stitching it. The value added per hour in each activity by workers in the two countries is shown in the table below. -Refer to the scenario above.The opportunity cost per dollar of value added in stitching shoes by workers in Country X is ________.

Joe and Billy are two classmates who need to work on a physics assignment together.The assignment includes sketching some diagrams and typing a brief description of each diagram.The table below shows the number of diagrams that each of them can sketch in an hour and the number of pages they can type in an hour. a)Who has a comparative advantage in sketching? b)Who should specialize in which task and why?

Scenario: Mark can make three tables and one chair in a day, while John can make four tables and one chair in a day. -Refer to the scenario above.Which of the following is true in this case?

What expression does not reflect the correct relationship between the current and financial account?

Which of the following results in a surplus of the U.S.current account,everything else equal?

Scenario: A country imported goods and services worth $40 billion and exported goods and services worth $37.8 billion during a particular year. -Refer to the scenario above.The country's net exports during that year were ________.

Scenario: There are two countries-Country X and Country Y-that trade only with each other. During a particular year, the residents of Country X purchased buildings worth $10 billion in Country Y. None of the other transactions between the two countries during that year involved the purchase or sale of assets. -Refer to the scenario above.Based on this information,it can be concluded that ________.

A bank in Berylia lends a sum of $100 billion to a business firm in Corinthia.Berylia makes a donation of $5 million to a charity in Corinthia.A retail giant in Corinthia opens a new facility worth $100 billion in Berylia.Total foreign direct investment in Berylia equals ________.

Scenario: Mark can make three tables and one chair in a day, while John can make four tables and one chair in a day. -Refer to the scenario above.Mark's opportunity cost of making a chair is ________.

Given below are the current account transactions of an economy in a year: i)Exported goods and services worth $120 billion ii)Imported goods worth $200 billion iii)Revenue earned from manufacturing plants situated abroad worth $80 billion iv)Dividend paid to foreign investors worth $10 billion v)Donations and disaster relief funds given to a foreign country worth $10 billion vi)"Gifts" received from foreign donors toward poverty alleviation worth $5 billion a)Calculate the economy's trade balance. b)What will be the balance in the economy's current account?

What are the potential consequences of renegotiating NAFTA and raising tariffs on goods imported in the United States from China and Mexico?

Identify the correct statement.

Scenario: Mark can make three tables and one chair in a day, while John can make four tables and one chair in a day. -Refer to the scenario above.John's opportunity cost of making a table is ________.

During a particular year,a country imported goods and services worth $10 billion and exported goods and services worth $11.1 billion.This implies that the country experienced a ________ during that year.

Scenario: Consider two economies, Beta and Zeta. Each farmer in Beta can grow 1,000 pounds of apples or 500 pounds of oranges in a year. Each farmer in Zeta can grow 400 pounds of apples or 1,200 pounds of oranges in a year. -Refer to the scenario above.Which of the following statements is true in this case?