Net exports rather than exports are included in demand/expenditures, because:
a. Actually, exports are included and not net exports because only exports are a source of demand.
b. Imports are counted in personal consumption expenditures. Therefore, net exports instead of just exports are included in aggregate demand.
c. Imported goods and services are a part of personal consumption, gross private domestic Investment, and government spending. Therefore, net exports instead of just exports are included in demand.
d. Neither exports nor net exports is included in aggregate demand.
e. None of the above.
Question 2 - Of the following balance of payments measures, which one shows bestwhether there are speculative financial capital flows from the nation?
a. Current account
b. Balance on goods & services
c. Balance on goods, services, and net income
d. Capital account
e. Financial account
Question 3 - If a good is produced but not consumed, then:
a. It is not included in GDP or GNP.
b. It is not included in GDP, but it is included in GNP.
c. It is not included in GNP, but it is included in GDP.
d. It enters into gross private domestic investment, which is a part of GDP and GNP.
e. It enters into passive consumption, which is a part of GDP in the following period.
Question 4 - Of the following balance of payments measures, which one is least able to measure whether a nation is paying its own way?
a. Current account.
b. Balance on goods & services.
c. Balance on goods, services, and net income
d. Reserves account
Question 5 - Which of the following is correct? Gross private domestic investment:
a. Includes goods that are produced but not consumed.
b. Is always greater than Personal Consumption Expenditures.
c. Includes stock and bonds.
d. All of the above are correct.
Question 6 - What effect does the following transaction have on the U.S. balance of payments?(Choose the proper debit and credit entries.)The U.S. Federal Reserve intervenes to puchase euros in the foreign exchange market.
a. Debit the U.S. financial account; credit the U.S. financialaccount.
b. Credit the U.S. financial account; debit the U.S. financialaccount.
c. Debit the U.S. financial account; credit the U.S. current account.
d. Credit the U.S. financial account; debit the U.S. current account.
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