Ch 5 Global Trade [AP & Reg]

S goods imports 1675 goods 3 balance on goods

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Unformatted text preview: and our imports from the Congo should (increase/decrease). 7. If the euro price of the dollar decreases the euro will (appreciate/depreciate) and their exports will (increase/decrease). • Measure of money inflows and inflows outflows between the U.S. and outflows the Rest of the World (ROW). – Inflows are referred to as CREDITS CREDITS – Outflows are referred to as DEBITS DEBITS • The Balance of Payments is divided Balance into 3 accounts. – Current Account – Capital/Financial Account – Official Reserves Account [foreign currency holdings of the Fed] IN OUT • Every transaction in the balance of payments is recorded twice in accordance with standard recorded accounting practice. – Ex. U.S. manufacturer, John Deere, exports $50 million John exports worth of farm equipment to Ireland. • A credit of $50 million to the current account. credit ( - $50 million worth of farm equipment or physical assets). • A debit of $50 million to the capital/financial account. debit ( + $50 million worth of Euros or f...
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This note was uploaded on 07/20/2012 for the course ECON 2106 at GCSU.

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