Exam 2: International Flow of Funds

The direct foreign investment positions by U.S.firms have generally ________ over time;the direct foreign investment positions in the U.S.by non-U.S.firms have generally ______ over time.

Direct foreign investment into the U.S.represents a ________.

Recently,the U.S.experienced an annual balance of trade representing a __________.

A high home inflation rate relative to other countries would _______ the home country's current account balance,other things equal.  A high growth in the home income level relative to other countries would _______ the home country's current account balance,other things equal.

An increase in the current account deficit will place _______ pressure on the home currency value,other things equal.

If the home currency begins to appreciate against other currencies,this should ____________ the current account balance,other things equal (assume that substitutes are readily available in the countries,and that the prices charged by firms remain the same).