Chapter 23: Q. 7 (page 575)
Why does the trade balance and the current account balance track so closely together over time?
The track balance number is included in the current account balance.
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How does the bottom portion of Figure , showing the international flow of investments and capital, differ from the upper portion?
What determines the size of a country’s trade deficit?
What are the two main sides of the national savings
and investment identity?
State whether each of the following events involves a financial flow to the Mexican economy or a financial flow out of the Mexican economy:
a. Mexico imports services from Japan
b. Mexico exports goods to Canada
c. U.S. investors receive a return from past financial investments in Mexico
Will nations that are more involved in foreign trade tend to have higher trade imbalances, lower trade imbalances, or is the pattern unpredictable?
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