Define the terms "merchandise trade balance" and "current account balance."
What will be an ideal response?
Merchandise trade balance is the balance of trade when only looking at goods and not services. Current account balance is a broad measure of the balance of trade that includes trade in goods and services, international flows on income, and foreign aid.
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Transfer payments
A) are included in the government expenditure category in gross domestic product. B) refer to all payments made to households by governments. C) refer to payments made by the government that are not made to purchase a good or service. D) are made by households to firms in exchange for goods and services.
Qualitatively, an increase in government purchases has the same impact as an increase in autonomous ________
A) consumption B) investment C) net exports D) all of the above E) none of the above