Consider two fictional economies, one called the domestic country and the other the foreign country. Given the

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Consider two fictional economies, one called the domestic country and the other the foreign country. Given the transactions listed in (a) through \((\mathrm{g})\), construct the balance of payments for each country. If necessary, include a statistical discrepancy.

a. The domestic country purchased \(\$ 100\) in oil from the foreign country.

b. Foreign tourists spent \(\$ 25\) on domestic ski slopes.

c. Foreign investors were paid \(\$ 15\) in dividends from their holdings of domestic equities.

d. Domestic residents gave \(\$ 25\) to foreign charities.

e. Domestic businesses borrowed \(\$ 65\) from foreign banks.

f. Foreign investors purchased \$15 of domestic government bonds.

g. Domestic investors sold \(\$ 50\) of their holdings of foreign government bonds.

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Macroeconomics

ISBN: 9780134897899

8th Edition

Authors: Olivier Jean Blanchard

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