Over its history, Brazil has borrowed more from the rest of the world than it has loaned to the rest of the world. Brazil
A) eventually will have a balance of payments account that does not balance.
B) is a debtor nation.
C) is a creditor nation.
D) has no current account balance.
B
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The supply of high-powered money is $100,000 and the money supply is $500,000. If every individual wishes to hold 5% of his or her deposits in the form of cash, then the bank reserve-holding ratio must be
A) 0.25 if banks have made all loans acceptable by the Federal Reserve requirements. B) 0.20 if banks have not made all loans acceptable by the Federal Reserve requirements. C) 0.17 if banks have not made all loans acceptable by the Federal Reserve requirements. D) 0.16 for any of the legally required reserve amount.
It is impossible for a country to have a current account surplus and a balance of payments deficit at the same time.
Answer the following statement true (T) or false (F)