B)
political infighting regarding whose currency will be the world leader.
C)
military conflict over control of vital assets.
D)
accumulation of wealth.
40.
Which of the following are financial instruments?
A)
real estate properties
B)
grocery store loyalty cards
C)
retail store inventories
D)
savings accounts, credit cards, and mortgages
41.
A nation's current account is:
A)
its current budget deficit.
B)
the previous year's budget deficit.
C)
a record of a nation's income, expenditure, deficit, and surplus during a particular period.
D)
the difference between its total wealth and its total debt.
42.
Whenever gross national income is less than gross national expenditure for some time, a nation will experience a(n):
A)
deficit in its current account.
B)
surplus in its current account.
C)
increase in GDP, since firms' sales will rise.
D)
rise in national wealth.
43.
In 2009, the area with the largest trade deficit was:
A)
China.
B)
the Eurozone.
C)
the United States.
D)
Japan.
44.
Which of the following situations would NOT be compatible with the others?
A)
a deficit in the current account
B)
expenditure being greater than income (production) in a nation
C)
a rise in national wealth
D)
new borrowing from the rest of the world
45.
The definition of total external net wealth is:
A)
the value of buildings, bank deposits, and monetary gold.
B)
the value of a nation's foreign assets minus the value of a nation's foreign liabilities.
C)
the value of stocks sold daily on international exchanges.
D)
minerals and oil reserves owned by a nation but located in another nation.
46.
External wealth can increase by all of the following, EXCEPT:
A)
rises in the value of international assets (capital gains).
B)
decreases in the value of liabilities to international entities.
C)
borrowing from international entities.
D)
lending to international entities.
47.
If a nation is a net creditor internationally, it means that:
A)
residents of the nation have more foreign assets than foreign liabilities.
B)
the nation is running low on international assets.
C)
residents of the nation have more foreign liabilities than foreign assets.
D)
the nation's government has extended credit to other nations' governments.
48.
A nation's net creditor position indicates that it:
A)
has collected more in taxes than its government has spent.
B)
owes money to other foreign and international government agencies.
C)
has positive net external wealth.
D)
has negative net external wealth.
49.
A nation's external wealth can be affected by which of the following?
I. the difference between international spending and income from the rest of the world
II. changes in currency values
III. capital gains and losses on equities and real estate
A)
I
B)
II and III
C)
I and III
D)
I, II, and III
50.
A country's external wealth is equal to:
A)
its exports minus imports.
B)
its overall debt.
C)
its foreign assets minus its foreign liabilities.
D)
the amount foreigners have invested in the United States.
51.
Suppose that a loan made in euros has experienced a capital gain. This indicates that the:
A)
dollar appreciated.