Practice Questions 1.1, 1.2 - 1 Practice Questions for...

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1 Practice Questions for Topics 1.1 and 1.2 I. Suggested MyEconLab questions: Chapter 13, Section 13.2: Exercise 2.1; Exercise 2.2; Exercise 2.3. Chapter 13, Section 13.3: Chapter Problem 4; Chapter Problem 9. II. Other questions: NOTE: Answers to all of the following questions follow on pages 4-7. 1. (Topic 1.1) Below are tables (similar to those in your lecture notes for chapter 13) presenting actual data on Canada’s balance of international payments for 2006. Certain entries have been omitted. Use the figures provided in the tables to “fill in the blanks.” Canada’s Current Account 2006 $ millions Total receipts 598,428 Goods and services 522,338 Goods 453,952 Services 68,386 Investment income 66,528 Transfers 9,562 Total payments ? Goods and services 486,866 Goods 404,345 Services 82,521 Investment income ? Transfers 11,023 Total (current account) balance (CA) 20,490 Canada’s Capital and Financial Account 2006 $ millions Capital Account, Net Flow (KA) 4,202 Capital account, inflows (receipts) 4,903 Capital Account, outflows (payments) -702 Financial Account, Net Flow (FA) ? Canadian foreign assets, net flow -166,967 Canadian foreign liabilities, net flow ? Total Capital and Financial Accounts, Net Flow (KA+FA) ? Statistical Discrepancy 2,277 Source: Statistics Canada.
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2 2. (Topic 1.1) The table below contains data for a hypothetical economy in 2011. Category $ billions Consumption Expenditure $660 Investment Expenditure $205 Government Purchases $264 Exports of Goods and Services $396 Imports of Goods and Services $371 Investment Income Received by Residents from Foreign Sources $55 Investment Income Paid to Non-residents from Domestic Sources $74 Using numbers provided in the table (and assuming that those numbers are sufficient for the purpose) calculate each of the following variables: i) GDP ( Q ); ii) GNP ( Y ); iii) domestic absorption ( A ); iv) the trade balance (NX) ; v) the current account balance (CA) ; vi) national saving ( S ).
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This note was uploaded on 02/02/2012 for the course ECONOMICS 239 taught by Professor Wu during the Winter '11 term at Wilfred Laurier University .

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Practice Questions 1.1, 1.2 - 1 Practice Questions for...

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