What types of transactions count as debits in the balance of payments? What types of transactions count as credits? Give examples
Any transaction that supplies a nation's currency and creates a demand for foreign currency in the foreign exchange market is a debit (or minus) item. Imports of goods are debits in the balance of payments. Any transaction that creates a demand for a nation's currency and a supply of foreign currency in the foreign exchange market is a credit (or plus) item. Exports are credits in the balance of payments..
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A small amount of international debt can become a heavy burden on a developing economy if
a. interest payments are a large percentage of export revenues b. a trade surplus develops c. the economy grows rapidly d. the country becomes more developed e. total borrowings exceed the $50 million level fixed by the IMF
Which of the following could be threatening to an existing monopoly structure?
a. impossible-to-overcome barriers to entry b. the depletion of alternative resources that could be used to produce the good that is being produced by the monopolist c. the extension of years enforcing a patent right d. mergers e. technological innovation that makes the old techniques of producing a good obsolete