国际金融英文版习题chapter

1InternationalFinanceAssignmentProblems(2) Name: StudentNo.:I. Choosethecorrect answerfor thefollowing questions (only ONEcorrect answer)(5creditsforeachquestion,totalcredits4x15=60)Accordingtotheprincipleofthebalancedbalanceofpayments,ifacountryreducesits foreign exchangereserves by$20million andthestatistical discrepancyisinthecreditentryof$5millioninagivenperiodoftime,thecountryruns ofitsbalanceofpaymentsduringthatperiodoftime.$15milliondeficitsIfacountry’sdomesticsavingisgreaterthandomesticinvestment,thecountryprobablyhas .acurrentaccountsurplusanetcapitaloutflowacurrentaccountdeficitBothAandBarepossible.Adebitentryinthebalance-of-paymentsaccountrepresentsatransactionthat .adomesticresidentreceivesapaymentfromabroadadomesticresidentmakesapaymenttoaforeignresidentwillimprovethecurrentaccountstatuswillhavenoaffectsonthenation ’sforeignexchangereservesIntermsofbalance-of-payments account, whichofthefollowing wouldberecordedasadebitentryintheU.S.BOP?exportsofmerchandiseexportsofservicespurchaseoftheU.S.Treasurybondsbynon-residentsanincreaseofthedepositinaU.S.resident'saccountataforeignbankAbalance-of-paymentsdeficitisdefinedasasituationinwhich .thevalueofpaymentsmadetotheforeignersexceedsthevaluereceiptsreceivedfromtheforeignersinagivenperiodoftimethegovernmentmustborrowinordertomeetitsbudgetobligationsthevalueofmanufacturedgoodexportsislessthanthevalueofimportedgoodsD.nationearnsmuchinextraassetsorreducedliabilitiesinitsdealingswiththerestoftheworldWhichofthefollowingwouldNOTbeconsideredasatypicalBOPtransaction?A.ToyotaUSAisaUSdistributorofautomobilesmanufacturedinJapanbyitsparentcompany.AU.S.subsidiary ofEuropeanfinancial giant,CreditSuisse,paysdividendstoitsparentinZurich.AUStouristpurchasesgiftsatamuseuminLondon.AllareexampleofBOPtransactions.Thebalanceofpaymentsisastatisticalrecordwhichmeasuresthevalueof .acountry ’sforeignexchangereservesinacertainperiodoftimeacountry ’sforeigntradesbetweentheresidentsofacountryandnon-residentsforagivenperiodoftimeall economicandfinancial transactionsbetweentheresidentsofacountryanditsnon-residentsforagivenperiodoftimeacountry ’scapitalinflowsandoutflowsataparticulardateinagivenyearABritish pensionfundsells someofits holdings ofthestocks ofU.S.companiesinordertobuyU.S.corporatebonds.Thistransactionwillaffect .theU.S.internationalinvestmentpositiontheBritishinternationalinvestmentpositionbothcountries ’internationalinvestmentpositionNoneoftheabove.Thisisbecausebothcountries ’international investmentposition unchanged,onlythecomposition offoreign investments inbothU.S.andU.K.changes.Whichofthefollowing transactions isincluded inChina’sbalanceaccount?AU.S.embassyinBeijingpayssalariestoitsAmericanstaffs.TheWorldBankfurnishestheChinesegovernmentwithaloan.AU.S.studentpaystuitionfeesforhis4year-studyinBeijingUniversity.D.ChineseembassyinWashingtonbuystelecommunicationequipmentsfromaChinesecompanyinShanghai.IftheU.S.runscurrentaccountdeficits,wecanexpectthat .itmayactasanetdebtorintherestoftheworlditsdomesticsavingmaylessthanitsdomesticinvestmentitsdomesticproductionislessthanitsdomesticconsumptionalloftheaboveThetradedeficitmeansthat .residentsareimportingmoregoodsthantheyareexportingWhichofthefollowingisanexampleofanexchangeoffinancialassets?theexchangeofbutterforwheattheexchangeofinformationtechnologytheexchangeofafixed-rateloanforafloating-rateloantheexchangeofgoldforjewelryFormostcountries,thesubcategorythattypicallydominatesthecurrentaccountis .unilateraltransfersgoodstradeincometradeservicestradeWhencategorizinginvestmentsforthefinancialaccountcomponentofthebalancepaymentsthe isaninvestmentwheretheinvestorhasnoincentivetocontrolwhereasthe isaninvestmentwheretheinvestorwantstocontrolovertheassets.directinvestment,portfolioinvestmentdirectinvestment,indirectinvestmentportfolioinvestment,indirectinvestmentportfolioinvestment,directinvestmentIfacountry ’smerchandiseexportsexceeditsimportsby$50million,servicestradebalanceisnet$30millionandunilateraltransfersmadeinexcessofthosereceivedby$5million,whatisthecountry ’scurrentaccountbalance? A.million$75million$15million$25millionCountryA ’sBOTis .CountryA ’scurrentaccountbalanceis .SupposethechangesincountryA ’sofficialreservesarezeroin2010,capitalandfinancialaccountbalanceMUSTbe .IfcountryA’sofficialreservesarerecordedonthecreditsideby$10millionin2010,capitalandfinancialaccountbalanceshouldbe .Basedontheassumptionofquestion4,countryAhasBOPdeficitorsurplusin2010?Explain.Whatisthecurrentaccountbalanceofanationwithagovernmentbudgetdeficitof$128billion,privatesavingof$806billion,anddomesticcapitalformationof$777billion?Expressthefollowing operations intheDutchbalanceofpaymentsinT-accounts:(5creditsforeachquestion,totalcredits3x5=15)ADutchcompanyexports?100,000goodstoa Londoncompanyfor?100,000inbankdeposits.Animportbilledfor?150,000paidwithacheckdrawnonaLondonbank.ADutchcompanybasedinRotterdamuses?1millionthatitwas