Exam 18: Macroeconomics in an Open Economy

The United States is called a debtor nation because

Holding all else constant,a rise in interest rates in the United States will cause the dollar to appreciate in international exchange markets.

Net foreign investment is a measure of net capital outflows,equal to capital outflows minus capital inflows in a given period of accounting.

The late Hugo Chavez,Venezuela's former president,proposed that the independence of the Venezuelan central bank be eliminated.Given the research on the relationship between central bank independence and inflation,we should expect this event to cause inflation to ________ and the real exchange rate to ________ between the two counties.(Assume the nominal exchange does not change,and that the United States is the domestic country).

Ceteris paribus,an increase in the government's budget deficit will decrease the financial account surplus.

An increase in perceived risk of foreign assets increased both the financial account surplus and current account deficit in the United States during the late 1990s.

Fiscal policy has a greater impact in a closed economy than it does in an open economy.

When the United States sends money to Indonesia to help tsunami survivors,in what account is this transaction recorded?

Which of the following would decrease the current account balance of the United States?

If a country has a fixed exchange rate,

In late 2014 and 2015 the value of the U.S.dollar increased relative to the currencies of most of its major trading partners.This rise in the price of the dollar against the other currencies was ________ for companies that exported to the United States and ________ for U.S.companies that exported to other countries.

The current account deficits incurred by the United States in the 1980s were caused,in the opinion of many economists,by

The level of saving in the United States has historically been low relative to the level of domestic investment.Based on this information,we would expect that

How does expansionary monetary policy affect net exports?

If the government finances an increase in government purchases with an increase in taxes,which of the following would you not expect to see?

Assuming no change in the nominal exchange rate,how will a higher rate of inflation in the United States relative to France affect the real exchange rate between the two countries? (Assume the United States is the "domestic" country. )

If net exports are equal to net foreign investment,

China runs a current account surplus with the United States.Which of the following must be true about China's balance of payments with the United States?

Which of the following transactions would be included in Germany's current account?

An increase in U.S.federal government budget deficits that raises U.S.interest rates relative to the rest of the world should