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13 Cards in this Set
- Front
- Back
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What are current accounts?
What does it indicate? |
The difference between nations savings & its investments.
Indicates economy's health |
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How does one sum up a current account?
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It is the sum of balance trade + net income abroad + net current transfers
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What does a negative current account indicate?
A positive current account? |
Negative: means the nation is a net borrower
Positive: the nation is a net lender |
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What is the balance of trade?
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The difference in value between country's imports and exports
Goods & services exports minus the imports |
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What does a negative balance of trade indicate?
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It shows a trade deficits, its imports ecxeeds its exports.
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What is the balance on services?
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Difference between funds received by a country when exporting services and funds paid for importing services
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What is a net foreign investment income?
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Recurring payments and income from a foreign country.
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What is a capital account?
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The net result of public and private international investment flowing in and out of a country
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Explain a capital flow
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It is the movement of money for the purposes of investment, trade or production
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What are the official international reserves?
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The acceptable form of payment between central banks from different countries.
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What is the overall balance payments? What are the 2 classifications of transactions?
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It summarizes the statements of the economy's transactions within the worlds market in a specific time
2 classifications transactions: current account & capital account |
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What is the balance of payment surplus?
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When a country exports more than its imports based on currency value
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What is the balance of payment deficit?
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When a country exports less than its imports based on currency value
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