1.

(06.01 MC) Use the data from a nation's balance of payments below to answer the following question.

Exports	$750
Imports	$600
Net income from abroad	$225
Net unilateral transfers	$30

Based on the data above, what is the current account and financial/capital account balance? (5 points)

	The current account is in surplus, and the financial/capital account is in deficit.
	The current account is in deficit, and the financial/capital account is in surplus.
	The current account and financial/capital account are both in deficit.
	The current account and financial/capital account are both in surplus.
	The current account is zero, and the financial/capital account is in surplus.

2.

(06.01 LC) Net unilateral transfers would be counted in a country's (5 points)

	capital account
	financial account
	current account
	nominal GDP
	real GDP

3.

(06.01 LC) A surplus in a country's financial/capital account necessarily means (5 points)

	an inflationary economy
	a recessionary economy
	a country's exports exceeding its imports
	flat real interest rates
	a deficit in its current account

4.

(06.01 MC) Which of the following is an example of a current account transaction? (5 points)

	A Canadian business sells $100 million in maple syrup to the United States.
	The United States government purchases $20 million worth of British pounds.
	A South Korean company builds a factory in Bangladesh.
	A major American technology company buys out its largest rival.
	A Chinese firm purchases United States government bonds.

5.

(06.01 MC) Which of the following is an example of a financial/capital account transaction? (5 points)

	Foreign aid after a natural disaster
	Someone in one country buying a government bond of another country
	A government paying annual interest to a foreigner who owns government bonds of the country
	An emigrant to one country sending money to family back in his country of origin
	The sale of machinery between two international companies