Explain the three categories of balance of payments transactions
What will be an ideal response?
Current account transactions relate to sales and purchases of goods and services. These include goods, services, and unilateral transfers. The capital account consists of transactions involving financial assets. If there are no official reserve transactions, the sum of the current account and the capital account is zero. Official reserve transactions involve payments or receipts of official reserves by the government. If the United States is running a deficit so that foreigners are turning dollars in for reserves, the official reserves of the government will decrease.
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When a firm has an accounting profit that is negative, it
A) will never produce output, even in the short run. B) may still have economic profit. C) has total revenue that is less than total cost. D) cannot be producing where price equals marginal cost.
Spending VCU4 on real-world goods and services causes the nation's:
a. Demand for real goods and services to remain the same and monetary base to rise. b. Demand for real goods and services to rise and M2 money supply to rise. c. Demand for real goods and services to rise and M2 money multiplier to remain the same. d. Demand for real goods and services to remain the same and M2 money supply to rise.