Balance of trade
Which transactions find out the balance of trade? When the balance of trade is in surplus?
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Exports of goods and imports of goods find out BOT. Whenever the value of exports of goods is bigger than the value of imports of goods.
Explain all the approaches of Paul Samuelson.
Assume that El Salvador can generate coffee at lower opportunity costs than Spain, whereas Spain can generate olive oil at lower opportunity costs than El Salvador. The citizens of both countries can potentially profit from international trade since of the efficiency
Describe which of the following is a visible and which is invisible item in Balance of payments. (a) Export of jute product (b) Software services exports. Answer: Q : Define induced investment Induced Induced investment: It is a type of investment that is of profit motive in nature.
Induced investment: It is a type of investment that is of profit motive in nature.
When Balance of payment of a country is Rs (-) 100 crores and total payment are Rs 500 crores. Determine its total receipts.
Describe the meaning of deficit in BOP: Whenever autonomous foreign exchange payments surpass autonomous foreign exchange receipts, the difference is termed as balance of payments deficit.
Autonomous or public investment: It is a type of investment that is not of profit motivated.
Define foreign exchange: It is the currency other than domestic currency.
Components of capital account of balance of payment: A) Borrowing and lending to and from abroad.B) Change in foreign exchange reserves C) Investment to and from abroad.
‘Can foreign exchange markets be analyzed in similar manner as the markets for ordinary physical commodities? Do demand slope downwards and supply slope upwards for currencies?’
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