ECO 1102 Lecture Notes - Lecture 26: Real Interest Rate, Openmarket, Exchange Rate
134 views2 pages
Verified Note
27 Mar 2020
School
Department
Course
Professor
ECO 1102 verified notes
26/26View all
Document Summary
Imports: value of foreign produced goods and services brought domestically. Exports: value of domestically-produced goods and services that are sold abroad. Trade surplus: positive balance trade. e. g. on slide 4. It is the flow of funds invested outside of a country. It can also be known as net foreign investment. Its goal is to measure the imbalance present within a country"s trade assets. When a firm engages in a direct foreign investment it leads to the capital flow out of. Canada and its outflow rises as a result. When an individual buys a stock that is foreign, their net capital outflow rises as the financial flow similar to above, flows out of canada. In terms of a bond issued by the government by a foreigner, the capital flows into. Canada but the canadian net capital outflow plunges. Real interest rate paid on foreign rather than domestic assets. Policies having an effect on the foreign ownership of domestic matters.
Get access
Grade+20% off
$8 USD/m$10 USD/m
Billed $96 USD annually
Homework Help
Study Guides
Textbook Solutions
Class Notes
Textbook Notes
Booster Class
40 Verified Answers
Class+
$8 USD/m
Billed $96 USD annually
Homework Help
Study Guides
Textbook Solutions
Class Notes
Textbook Notes
Booster Class
30 Verified Answers
Related textbook solutions
Related Documents
Related Questions
Exports of goods & services | $1000 |
Imports of goods & services | $800 |
The net change in assets owned abroad | $590 |
The net change in foreign-owned assets at home | $400 |
Unilateral transfers received | $100 |
Unilateral transfers paid | $200 |
Investment income paid to foreigners | $300 |
Investment income received from foreigners | $400 |
The balance on the capital account | $0 |
1. The balance on the current account is A) $100. B) $200. C) 0. D) - $100
2. The balance on the financial account is A) -$90. B) -$190. C) $100. D) $200
3. The statistical discrepancy is A) -$5. B) $5. C) $10. D) -$10
4. From the domestic economy's perspective,
A) there is a net international capital inflow equal to $190.
B) there is a net international capital outflow equal to $190.
C) the net international capital flow is zero.
D) its domestic absorption exceeds its GNP by $200.