Question

QUESTION 8

1. When domestic savings are too small to finance domestic borrowing, the country needs a foreign savings inflow to make up the difference.

True

False

QUESTION 9

1. Payments of cross-border income (like dividends on stocks and interest on bonds) for past investments go into the Capital and Financial Account.

True

False

QUESTION 10

1. Suppose a foreign central bank buys domestic government bonds. This purchase is included as part of,

	a.	the domestic country's reserve transactions
	b.	the domestic country's "broad" balance of trade
	c.	both A and B
	d.	neither A nor B

QUESTION 11

1. A Capital (& Financial) Account outflow can be thought of as domestic investment in a foreign economy.

True

False

QUESTION 12

1. Suppose the Spanish firm Banco Santander wants to borrow, so it issues some bonds in Europe, which U.S. investors buy. This purchase of the bonds is a money inflow for the U.S.

True

False

Answer 1

8.

True

Gap between domestic borrowings and savings are bridged by the foreign savings.

9.

False

Income from these type of investments, will go to the head of current account.

11.

True

As investments are taking place from domestic country to foreign country.

12.

False

Purchase of bonds is the money outflow from the USA.

Pl. repost other unanswered questions for their proper answers!