Calculate the official settlements balance

Assignment Help Business Economics

Reference no: EM1349189

In 2007 the country of Ikonomia has a current account deficit of $1 billion and a non reserve financial account surplus of $750 million. Ikonomias capital account is in $100 million surplus. In addition, Ikonomian factors located foreign countries earn $700 million. Ikonomia has a trade deficit of $800 million. Assume Ikonomia neither gives nor receives unilateral transfers. Ikonomia's GDP is $9 million.

a) Elucidate what happened to Ikonomia's net foreign assets during 2007? Did it acquire or lose foreign assets during the year?

b) Calculate the official settlements balance. Based on this number, what happened to the central banks (foreign) reserves.

c) How much income did foreign factors of production earn in Ikonomia during 2007?

d) Compute net factor income from abroad

e) Using the identity BOP =CA+FA+KA, show that BOP=0

f) Compute Ikonomia's gross national expenditure, gross national income, and gross national disposable income.

Reference no: EM1349189

Questions Cloud

How will management use work teams and work groups : Which methods will be used to present the operational change and how would you develop a training that conveys to multiple audiences within the organization?

Preview of financial accountant-forecasting : Generally forecasting and planning is considered the preview of the financial accountant or the forecasting and planning department.

Determination of weighted average cost of capital : Given the following data for El Pollo Loco Corporation determine its weighted average cost of capital

Psychodynamic theories of freud and of adler : Compare and contrast the psychodynamic theories of Freud and of Adler.

Calculate the official settlements balance : Elucidate what happened to Ikonomia's net foreign assets during 2007. Did it acquire or lose foreign assets during the year.

Explain how important is product quality : Explain How important is product quality when a limited edition soft drink like Ice Cucumber sells out in a matter of weeks and What criteria would you suggest that Pepsi and Suntory use when screening ideas for new limited-edition soft drinks?

Explain what are keys to organizational and cultural change : Would organizational change be effective without cultural change and why or why not

Fixed- and variable- cost pools : Suppose one predetermined rate per copy was used to allocate all photocopy costs. What rate would be used and how much cost would be allocated to the Public Works Department in August?

Burke-litwin causal model of organizational performance : The external environment includes exterior conditions or situations that influence the performance of the organization.

User Account

All Pages