Exam 18: Open-Economy Macroeconomic Models

The nominal exchange rate is the

If a country had a trade surplus of $100 billion and then its exports rose by $40 billion and its imports rose by $30 billion, its net exports would now be

Greg, a U.S. citizen, opens an ice cream store in Bermuda. His expenditures are U.S.

Suppose that a U.S. dollar buys more gold in Australia than it buys in Russia. What does purchasing-power parity imply should happen?

If a lobster in Maine costs $10 and that the same type of lobster in Massachusetts costs $30, then people could make a profit by

If Walmart buys $50 million worth of consumer goods from China and sells them in the U.S., and China uses the $50 million to purchase U.S. bonds, U.S. net exports and U.S. net capital outflow both fall.

A country has a trade deficit. Its

Which of the following is an example of U.S. foreign portfolio investment?

If the exchange rate were 5 Egyptian pounds per U.S. dollar, a watch that costs $25 US dollars would cost

Most of the change from 1980 to 1987 in U.S. net capital outflow as a percent of GDP was due to a(n)

If a dollar currently purchases 12.5 pesos and someone forecasts that in a year it will be 14 pesos, then the forecast is given in

If a country has a trade surplus

If a nation is selling more goods and services to foreigners than it is buying from them, then on net it must be selling assets abroad.

If saving is less than domestic investment, then

If a country had a trade deficit of $10 billion and then its exports rose by $20 billion and its imports rose by $10 billion, its net exports would now be

If the exchange rate is 8 Moroccan dirhams per U.S. dollars, a crate of oranges costs 400 dirhams in the Moroccan capital of Rabat, and a similar crate of oranges in Miami sells for $45 dollars, then

Purchasing-power parity theory does not hold at all times because

In the U.S. a candy bar costs $1. If the nominal exchange rate were 6 Chinese yuan per dollar and the real exchange rate were 1.2, then, what would be the price of a candy bar in China?

A U.S. firm exchanges dollars for yen and then uses them to buy Japanese goods. Overall as a result of these transactions

On behalf of your firm, you make frequent trips to Singapore. You notice that you always have to pay more dollars to get enough local currency to get your nails manicured than you have to pay to get manicured in the United States. This is