Questions from Financial Markets


Q: For each of the following, identify in which part of the

For each of the following, identify in which part of the balance-of-payments account it appears (current account, capital account, or net change in international reserves) and whether it is a receipt...

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Q: Why does a balance-of-payments deficit for the United

Why does a balance-of-payments deficit for the United States have a different effect on its international reserves than a balance-of-payments deficit for the Netherlands?

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Q: Under fixed exchange rates, if Britain becomes more productive relative to

Under fixed exchange rates, if Britain becomes more productive relative to the United States, what foreign exchange intervention is necessary to maintain the fixed exchange rate between dollars and po...

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Q: If a country’s par exchange rate was undervalued during the Bretton Woods

If a country’s par exchange rate was undervalued during the Bretton Woods fixed exchange rate regime, what kind of intervention would that country’s central bank be forced to undertake, and what effec...

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Q: How can a large balance-of-payments surplus contribute to

How can a large balance-of-payments surplus contribute to the country’s inflation rate?

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Q: Why can balance-of-payments deficits force some countries to

Why can balance-of-payments deficits force some countries to implement a contractionary monetary policy?

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Q: “Balance-of-payments deficits always cause a country to

“Balance-of-payments deficits always cause a country to lose international reserves.” Is this statement true, false, or uncertain? Explain your answer.

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Q: Property taxes in DeKalb County are roughly 2.66% of

Property taxes in DeKalb County are roughly 2.66% of the purchase price every year. If you just bought a $100,000 home, what is the PV of all the future property tax payments? Assume that the house re...

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Q: What is the exchange rate between dollars and Swiss francs if one

What is the exchange rate between dollars and Swiss francs if one dollar is convertible into 1/20 ounce of gold and one Swiss franc is convertible into 1/40 ounce of gold?

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Q: What does the month-end balance sheet for NewBank look like

What does the month-end balance sheet for NewBank look like? Calculate this before any income tax consideration.

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