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Q. What types of international transactions are recorded in the balance of payment accounts?
Answer: Three kinds' transactions that involve exports and imports of goods and services transactions that involve exports and imports of goods and services and the purchase or sell of financial assets other activities resulting in transfer of wealth between countries that are recorded in the capital account.
Q. Discuss the main factors affecting the position of the DD schedule. Answer: The level of government taxes, demand, and investment and the domestic and foreign price
Illustration of reciprocal demand through example
Using the Heckscher-Ohlin model, discuss how the differences in supply and demand conditions between countries create a basis for trade.
Q. Suppose Airbus is set to give the aircraft before Boeing. Which company will enter the market? Answer: Boeing will not and Airbus will produce.
Regulation of International Finance
Q. Why do we observe the Leontief paradox? Answer: There are several possible answers that they may be categorized into three groups. One would argue that the theory or model
what is meant by country specific advantage?
Q. Calculate the effects of the fall in the relative price of good 2 on the income of the specific factors capital and land. Answer: For the reason that good 2 uses land, a f
Q. Analyze the effects of devaluation on an economy. Answer: Devaluation basis a rise in output a rise in official reserves and an expansion of the money supply. A private cap
if the US dollar depreciates dramatically relative to the Chinese yuan, what effect would this have on consumers and businesses in each country? When is a falling dollar good or ba
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