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A purchases of us treasury bills by foreign investors

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a.Purchases of U.S. Treasury bills by foreign investorsb.Purchases of U.S. notes by foreign investorsc.Purchases of U.S. bonds by foreign investorsd.Purchases of U.S. debt instruments by foreign investorse.Purchases of U.S. stocks by foreign investors36.Which of these is not an example of portfolio investments?a.Purchases of debt securitiesb.Purchases of companiesc.Purchases of bondsd.Interest-bearing accountse.None of the above37. The U.S. official reserves account may include all of the following EXCEPTa.German marks.b.U.S. dollar.c.Mexican pesos.d.gold.e.Japanese yen.1-68
Globalization38. The methodology of the balance of payments requires that the current andfinancial accounts bea.complementary.b.offsetting.i.direct.j.common.k.indirect.39. The official reserve account is the total ___ held by official monetary authoritieswithin the country.a.hard currencies and soft currenciesb.hard currencies and goldc.gold and silverd.agricultural and machinery productse.all of the above40.The ______ makes sure that the BOP actually balances.a.official reserves accountb.net errors and omissions accountc.capital accountd.financial accounte.current account41.The ______ is the total currency and metallic reserves held by official monetaryauthorities within the country.a.official reserves accountb.net errors and omissions accountc.capital accountd.financial accounte.current account42. If a country’s fixed exchange rate is under devaluation pressure, the central bankof the country should _______.a.spend foreign currency reserves to support its currencyb.restrict capital inflowsc.purchase foreign currencies with its own currencyd.import more merchandisee.allow market forces to correct the situation43. The official statements balance is the sum of all of the following EXCEPT1-69
Globalizationa.the current account.b.the capital account.c.the official reserves account.d.the financial account.e.the net errors and omissions account.44.A country that is experiencing a surplus balance of payments will experiencea.a rise in interest rates.b.a surplus in merchandise and services trade balances.c.upward pressure on the value of its currency.d.a loss in foreign currency reserves.e.none of the above.45. Countries that attempt to maintain foxed exchange rates must maintain substantial___________ reserves for use in defending their currency’s value.a.hard currenciesb.soft currenciesc.domestic currenciesd.barter productse.none of the above46.Capital flighta.is the rapid withdrawal of capital from a country.b.results in the loss of a financial account surplus.c.creates a severe deficit in a country’s overall balance of payments (BOP).d.is typically accompanied by a rapid currency depreciation or devaluation.e.All of the above.47.The rapid withdrawal of capital from the country results in the ______, creating asevere deficit in the country’s overall BOP.

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Term
Spring
Professor
Pisani
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