Exam 18: Open-Economy Macroeconomics: Basic Concepts

A country purchases more goods and services from residents of foreign countries than residents of foreign countries purchase from it. This country has

If you are vacationing in France and the dollar depreciates relative to the euro, then

Which of the following is inconsistent with the others?

U.S. exports make up less than 20 percent of GDP.

If the exchange rate is 1.25 New Zealand dollars per U.S dollar, the price of apples is $2 a pound in the U.S. and 1 New Zealand dollar per pound in New Zealand, what is the real exchange rate?

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

If a country's net exports fall, then its net capital outflow falls by the same amount.

Other things the same, if a country saves more, then

Suppose that the nominal exchange rate is .80 euro per dollar, that the price of a basket of goods in the U.S. is $500 and the price of a basket of goods in Germany is 400 Euro. Suppose that these values change to .90 euro per dollar, $600, and 600 euro. Then the real exchange rate would

A U.S. company uses U.K. pounds it already owned to purchase bonds issued by a company in the U.K. Which of these countries has an increase in net capital outflow?

Other things the same, an increase in the foreign price level

In the U.S. a box of tea costs $5. The same box of tea in Uganda costs 10,000 schillings the currency of Uganda). If the real exchange rate is 5/4, what is the nominal exchange rate? Show your work.

According to purchasing-power parity, if over the course of a year the price level in the U.S. rises more than in Japan, then which of the following falls?

Purchasing-power parity describes the forces that determine

In which of the following situations must national saving rise?

Which of the following does purchasing-power parity imply?

U.S. exports are $300 billion, U.S. imports are $500 billion. Which of the following are consistent with the level of net exports?

If the Kenyan nominal exchange rate declines, and prices are unchanged in Kenya and abroad, then the Kenyan real exchange rate

A country has net capital outflow of -10 billion euros and domestic investment of 20 billion euros. What is its national saving?

Which of the following equations is always correct in an open economy?