11. A country experiencing a significant balance-of-payments surplus would be likely to
A. Expand imports, offering marketing opportunities for foreign enterprises.
B. Unlikely to impose foreign exchange restrictions.
C. Expand exports, offering international marketing opportunities for domestic enterprises.
D. Both a) and b)
E. None of the above
12. Suppose the McDonalds Corporation imports Canadian beef, paying for it by transferring the funds to a
New York bank account kept by the Canadian Beef producer.
A. Payment by McDonalds will be recorded as a debit
B. The deposit of the funds by the seller will be recorded as a debit
C. Payment by McDonalds will be recorded as a credit
D. The deposit of the funds by the buyer will be credit
13. Since the balance of payments is presented as a system of double-entry bookkeeping,
A. Every credit in the account is balanced by a matching debit
B. Every debit in the account is balanced by a matching credit
C. Answers a) and b) are both true
D. None of the above
14. Suppose the InBev Corporation (a non-U.S. MNC) buys the Anheuser-Busch Corporation, paying the
U.S. shareholders cash.
A. Payment by InBev will be recorded as a debit
B. The deposit of the funds by the sellers will be recorded as a debit
C. Payment by InBev will be recorded as a credit
D. The deposit of the funds by the buyer will be credit
15. The current account includes
A. The export and import of goods and services.
B. All purchases and sales of assets such as stocks, bonds, bank accounts, real estate, and businesses.
C.
All purchases and sales of international reserve assets such as dollars, foreign exchanges, gold, and
special drawing rights (SDRs).
D. None of the above
16. A country with a current account surplus
A. Acquires IOUs from foreigners, thereby increasing its net foreign wealth.
B. Must borrow from foreigners or draw down on its previously accumulated foreign wealth.
C. Will experience a reduction in the country's net foreign wealth.
D. Both b) and c)
17. The capital account includes
A. The export and import of goods and services.
B. All purchases and sales of assets such as stocks, bonds, bank accounts, real estate, and businesses.
C.
All purchases and sales of international reserve assets such as dollars, foreign exchanges, gold, and
special drawing rights (SDRs).
D. None of the above
18. The official reserve account includes
A. The export and import of goods and services.
B. All purchases and sales of assets such as stocks, bonds, bank accounts, real estate, and businesses.
C.
All purchases and sales of international reserve assets such as dollars, foreign exchanges, gold, and
special drawing rights (SDRs).
D. None of the above
19. A country's international transactions can be grouped into the following three main types:
A. current account, medium term account, and long term capital account
B. current account, long term capital account, and official reserve account
C. current account, capital account, and official reserve account
D. capital account, official reserve account, trade account
20. Invisible trade refers to:
A. services that avoid tax payments
B. the underground economy
C. legal, consulting, and engineering services
D. tourist expenditures, only
A. Expand imports, offering marketing opportunities for foreign enterprises.
B. Unlikely to impose foreign exchange restrictions.
C. Expand exports, offering international marketing opportunities for domestic enterprises.
D. Both a) and b)
E. None of the above
12. Suppose the McDonalds Corporation imports Canadian beef, paying for it by transferring the funds to a
New York bank account kept by the Canadian Beef producer.
A. Payment by McDonalds will be recorded as a debit
B. The deposit of the funds by the seller will be recorded as a debit
C. Payment by McDonalds will be recorded as a credit
D. The deposit of the funds by the buyer will be credit
13. Since the balance of payments is presented as a system of double-entry bookkeeping,
A. Every credit in the account is balanced by a matching debit
B. Every debit in the account is balanced by a matching credit
C. Answers a) and b) are both true
D. None of the above
14. Suppose the InBev Corporation (a non-U.S. MNC) buys the Anheuser-Busch Corporation, paying the
U.S. shareholders cash.
A. Payment by InBev will be recorded as a debit
B. The deposit of the funds by the sellers will be recorded as a debit
C. Payment by InBev will be recorded as a credit
D. The deposit of the funds by the buyer will be credit
15. The current account includes
A. The export and import of goods and services.
B. All purchases and sales of assets such as stocks, bonds, bank accounts, real estate, and businesses.
C.
All purchases and sales of international reserve assets such as dollars, foreign exchanges, gold, and
special drawing rights (SDRs).
D. None of the above
16. A country with a current account surplus
A. Acquires IOUs from foreigners, thereby increasing its net foreign wealth.
B. Must borrow from foreigners or draw down on its previously accumulated foreign wealth.
C. Will experience a reduction in the country's net foreign wealth.
D. Both b) and c)
17. The capital account includes
A. The export and import of goods and services.
B. All purchases and sales of assets such as stocks, bonds, bank accounts, real estate, and businesses.
C.
All purchases and sales of international reserve assets such as dollars, foreign exchanges, gold, and
special drawing rights (SDRs).
D. None of the above
18. The official reserve account includes
A. The export and import of goods and services.
B. All purchases and sales of assets such as stocks, bonds, bank accounts, real estate, and businesses.
C.
All purchases and sales of international reserve assets such as dollars, foreign exchanges, gold, and
special drawing rights (SDRs).
D. None of the above
19. A country's international transactions can be grouped into the following three main types:
A. current account, medium term account, and long term capital account
B. current account, long term capital account, and official reserve account
C. current account, capital account, and official reserve account
D. capital account, official reserve account, trade account
20. Invisible trade refers to:
A. services that avoid tax payments
B. the underground economy
C. legal, consulting, and engineering services
D. tourist expenditures, only
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