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wrote...
Posts: 148
2 months ago

Question 1.

Which of the following is a deficit item on the U.S. balance of payments accounts?

• A Spaniard buys 100 shares of Ford stock.

• A U.S. firm sells a product to a Mexican firm.

• A U.S. resident buys a smartphone in Japan.

• An Italian tourist in Miami purchases a beach ball.

Question 2.

In the balance of payments, which of the following is TRUE of the sum of the capital account balance, the current account balance, and the official reserve transactions account balance?

• This sum must always be zero, because the sum of all surplus and deficit items associated with cross-border transactions must equal zero.

• This sum is positive only if the U.S. government operates with a budget surplus.

• This sum is either positive or negative, depending on whether the sum of all surplus and deficit items associated with cross-border transactions is positive or negative.

• This sum is positive only if the U.S. government operates with a budget deficit.
Source  Download
Economics Today: The Micro View
Edition: 19th
Author:
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Answer verified by a subject expert
wrote...
Posts: 191
2 months ago
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Answer 1

A U.S. resident buys a smartphone in Japan.

Answer 2

This sum must always be zero, because the sum of all surplus and deficit items associated with cross-border transactions must equal zero.
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Slight Smile Good luck on the rest
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