Exam 3 - exam 3 Econ 2200-6 TR 3.30 pm Multiple Choice...

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exam 3 Econ 2200-6 TR 3.30 pm Multiple Choice Identify the choice that best completes the statement or answers the question. ____ 1. Oceania buys $40 of wine from Escudia and Escudia buys $100 of wool from Oceania. Supposing this is the only trade that these countries do. What are the net exports of Oceania and Escudia in that order? a. $140 and $140 b. $100 and $40 c. $60 and -$60 d. None of the above is correct. Table 31-1 Argentinean Trade Flows Goods Services Purchased Abroad $40 billion Purchased Abroad $20 billion Sold Abroad $10 billion Sold Abroad $25 billion ____ 2. Refer to Table 31-1. What are Argentina’s net exports? a. $30 billion b. $5 billion c. -$5 billion d. -$25 billion ____ 3. A firm in China sells toys to a U.S. department store chain. Other things the same, these sales a. increase U.S. net exports and decrease Chinese net exports. b. decrease U.S. net exports and increase Chinese net exports. c. increase U.S. and Chinese net exports. d. decrease U.S. and Chinese net exports. ____ 4. A firm in India hires a U.S. firm to provide economic forecasts. By itself this transaction a. increases U.S. exports and so increases the U.S. trade balance. b. increases U.S. exports and so decreases the U.S. trade balance. c. increases U.S. imports and so increases the U.S. trade balance. d. increases U.S. imports and so decreases the U.S. trade balance. ____ 5. Which of the following is an example of U.S. foreign direct investment? a. A U.S. based mutual fund buys stock in Eastern European companies. b. A U.S. citizen builds and operates a coffee shop in the Netherlands.
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c. A Swiss bank buys a U.S. government bond. d. A German tractor factory opens a plant in Waterloo, Iowa. ____ 6. Suppose that the real return from operating factories in Ghana rises relative to the real rate of return in the United States. Other things the same, a. this will increases U.S. net capital outflow and decrease Ghanan net capital outflow. b. this will decreases U.S. net capital outflow and increase Ghanan net capital outflow. c. this will only increase U.S. net capital outflow. d. this will only increase Ghanan net capital outflow. ____ 7. A U.S. firm buys bonds issued by a technology center in India. This purchase is an example of U.S. a. foreign portfolio investment. By itself it is an increase in U.S. holdings of foreign bonds and increases U.S. net capital outflow. b. foreign portfolio investment. By itself it is an increase in U.S. holdings of foreign bonds and decreases U.S. net capital outflow. c. foreign direct investment. By itself it is an increase in U.S. holdings of foreign bonds and increases U.S. net capital outflow. d. foreign direct investment. By itself it is an increase in U.S. holdings of foreign bonds and decreases U.S. net capital outflow. ____ 8.
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Exam 3 - exam 3 Econ 2200-6 TR 3.30 pm Multiple Choice...

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