Chapter 18 Open-Economy Macroeconomic Models
THE INTERNATIONAL FLOW OF GOODS AND CAPITAL
Table 18-1
Bolivian Trade Flows
Goods Services
Purchased $40 billion Purchased $20 billion
Abroad Abroad
Sold Abroad $10 billion Sold Abroad $25 billion
26. Refer to Table 18-1. What are Bolivia’s exports?
a. $60 billion
b. $35 billion
c. $10 billion
d. None of the above are correct.
27. Refer to Table 18-1. What are Bolivia’s imports?
a. $60 billion
b. $35 billion
c. $40 billion
d. None of the above are correct.
28. Refer to Table 18-1. What are Bolivia’s net exports?
a. $30 billion
b. $5 billion
c. -$5 billion
d. -$25 billion
46.If a country had a trade deficit of $10 billion and then its exports rose by $20 billion and its imports
rose by $10 billion, its net exports would now be
a. $0
b. $10 billion.
c. -$10 billion.
d. -$20 billion.
56.If U.S. residents purchase $500 billion of foreign assets and foreigners purchase $1300 billion of
U.S. assets,
a. U.S. net capital outflow is $800 billion; capital is flowing into the U.S.
b. U.S. net capital outflow is $800 billion; capital is flowing out of the U.S.
c. U.S. net capital outflow is -$800 billion; capital is flowing into the U.S.
d. U.S. net capital outflow is -$800 billion; capital is flowing out of the U.S.
133. U.S. exports are $400 billion, U.S. imports are $900 billion. Which of the following are
consistent with the level of net exports?
a. The U.S has a trade surplus. The U.S. purchases $800 of foreign assets and foreign countries
purchase $300 of U.S. assets.
b. The U.S. has a trade surplus. The U.S. purchases $300 of foreign assets and foreign countries
purchase $800 of U.S. assets.
c. The U.S has a trade deficit. The U.S. purchases $800 of foreign assets and foreign countries
purchase $300 of U.S. assets.
d. The U.S. has a trade deficit. The U.S. purchases $300 of foreign assets and foreign countries
purchase $800 of U.S. asset.
NX < 0 => NCO < 0
183. During some year a country had exports of $30 billion, imports of $40 billion, and domestic
investment of $60 billion. What was its saving during the year? S = I + NX
a. $70 billion
b. $50 billion
c. $10 billion
d. -$10 billion
185.If a county has 25 billion euros of imports, 15 billion euros of exports, and sells 20 billion euros of
assets to foreigners, how many foreign assets do domestic residents purchase?
a. 5 billion euros
b. 10 billion euros
c. 30 billion euros
d. None of the above are correct.
186. A country has $100 million of net exports and $170 million of saving. Net capital outflow is
a. $70 million and domestic investment is $170 million.
b. $70 million and domestic investment is $270 million.
c. $100 million and domestic investment is $70 million.
d. None of the above is correct.
189. A country has $50 million of domestic investment and net capital outflow of $15 million. What is
saving?
a. $65 million.
b. -$65 million.
c. $35 million.
d. -$35 million.
197. In an open economy, gross domestic product equals $1,850 billion, consumption expenditure
equals $975 billion, government expenditure equals $225 billion, investment equals $500 billion,
and net exports equals $150 billion. What is national savings? S = Y – C - G
a. $0
b. $500 billion
c. $650 billion
d. $975 billion
198. In an open economy, gross domestic product equals $1,650 billion, government expenditure
equals $250 billion, and savings equals $550 billion. What is consumption expenditure?
a. $250 billion
b. $300 billion
c. $550 billion
d. $850 billion
