Exam 13: Open-Economy Macroeconomics: Basic Concepts

If a U.S. dollar purchases 4 Argentinean pesos, and a gallon of milk costs $3 in the U.S. and 6 pesos in Argentina what is the real exchange rate?

To increase domestic investment, a country must increase its saving.

Suppose the world had only two countries and domestic residents of country A purchased $50 billion of assets from country B and country B purchased $30 billion of assets from country A. What would the net capital outflows of both countries be?

A pound of steak costs $10 in the U.S. and 56.25 riyals the currency of Saudi Arabia) in Saudi Arabia. If the real exchange rate is 2/3, what is the nominal exchange rate? Show your work.

If a dollar buys more corn in the U.S. than in Mexico, then

If over the next six months inflation is higher in the U.S. than in foreign countries, then according to purchasing- power parity

When net capital outflow is negative, it means that on net the value of domestic assets purchased by foreigners exceeds the value of foreign assets purchased by domestic residents.

If a country has a trade deficit then

A country has $60 million of saving and domestic investment of $40 million. Net exports are

A U.S. corporation builds a restaurant in China. Its expenditures are U.S.

Over the past six decades, the U.S. economy has experienced a dramatic increase in the relative importance of international trade and finance.

From 1960 to about 1980 the net capital outflow of the U.S. was typically

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

Net capital outflow equals

Table 31-1 -Refer to Table 31-1. What are Bolivia's net exports?

If a nation produces more than it spends what do we know about: A. its net exports? B. its net capital outflow? C. its saving in relation to its domestic investment?

If purchasing-power parity holds, then the value of the

Which of the following is correct?

Why are net exports and net capital outflow always equal?

According to purchasing-power parity, which of the following necessarily equals the ratio of the foreign price level divided by the domestic price level?