Exam 7: The International Monetary System and the Balance of Payments

The ________ records exports and imports of goods and services, investment income, and gifts.

The ________ records the levels of gold, convertible currencies, special drawing rights, and reserve positions at the IMF held by a national government.

Why did the gold standard result in a fixed exchange rate system? How did the United States dollar become the currency standard under the Bretton Woods system?

Why do you think the gold standard and mercantilism are considered opposites?

Currencies that can be freely exchanged for other currencies without legal restrictions are called ________.

Why was the International Development Association created? What is the purpose of the IDA? Do you think its loan guidelines are fair? Why or why not?

Which of the following is calculated daily as a weighted average of the market value of four major currencies?

The ________ is a double-entry bookkeeping system designed to measure and record all economic transactions between residents of one country and residents of all countries during a particular time period.

When did the sterling-based gold standard begin to unravel?

The balance of payments accounting system is a double entry system.

Why does the international monetary system exist?

Under a managed float ________.

The ________ was created to manage currency relationships within the EU.

During the gold standard, most firms preferred their payment in gold rather than in currency.

All of the following are typical short-term foreign portfolio investments included in the capital account except ________.

Describe the major outcomes of the Bretton Woods conference.

The ________ establishes the rules by which countries value and exchange their currencies.

Carmen is a vice president at TechWorks, an MNE that manufactures computer chips. TechWorks is considering expansion, and Carmen is responsible for identifying potential locations. Which of the following would best help Carmen identify a country's unilateral transfers and income generated by past investments?

A(n) ________ is the price of one currency in terms of a second currency.

The ________ shows the difference between a country's exports of services and its imports of services.