Economics MCQs

Page No. 366

The current account includes ?


athe value of trade in merchandise


bservices


c unilateral transfers


d All of the above


View Answer All of the above

A capital account surplus might be expected to cause a current account deficit because the associated ?


acapital outflow would cause the nation’s currency to depreciate contributing to a trade deficit


bcapital inflow would cause the nation’s currency to depreciate contributing to a trade deficit


c capital inflow would cause the nation’s currency to appreciate contributing to a trade deficit


dcapital outflow would cause the nation’s currency to appreciate contributing to a trade deficit



All of the following are credit items in the balance of payments except ?


ainvestment inflows


bmerchandise exports


cpayments for American services to foreigners


d private gives to foreign residents



In the balance of payments the statistical discrepancy is used to ?


a insure that the sum of all debits matches the sum of all credits


b insure that trade imports equals the value of trade exports


cobtain an accurate account of a balance of payments deficit


dobtain an accurate account of a balance of payments surplus



Credit (-) items in the balance of payments correspond to anything that ?


ainvolves receipts from foreigners


b involves payments to foreigners


cincreases the domestic money supply


ddecreases the demand for foreign exchange



A country that is a net international debtor initially experiences a (an) ?


alarger savings pool available to finance domestic spending


bhigher interest rate which leads to lower domestic investment


closs of funds to trading partners overseas


ddecrease in its services exports to other countries



Referring to the above table, the U.S balance of international indebtedness suggests that the U.S is a net ?


adebtor


bcreditor


cspender


dexporter


View Answer creditor

The Baker plan (1985) stressed _______ and the Brady Plan (1989) emphasized _______ respectively?


aIMF decentralization; World Bank dissolution


bnew loans from multilateral agencies and surplus countries; debt reduction or write-downs


cstructural adjustment loans for LDCs experiencing unanticipated external shocks; renewed emphases on macroeconomic stabilization programs


ddebt relief for at leas three-fourths of the eligible HIPCs; shorter requirements for adjustment programs



Which of the following statement is Not true ?


aThe ratio of debt service to GNP is very good indicator of the debt burden


b Many large LDC debtors borrowed heavily because of their excellent international credit ratings


cMiddle income countries account for almost four-fifths of the total outstanding debt of all LDCs


dThe debt-burden of sub Saharan African countries may be as heavy as for middle income countries



Shortly after 1979 World Bank introduced loans that emphasized reforms in trade, agriculture industry public enterprise financial energy education or other sectors and were known as ?


aStructural adjustment loans


bsectoral adjustment loans


cinternal adjustment loans


dexternal leverage loans



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