write short notes on autonomous transactions and accommodating transac
distinguish between autonomous transactions and accommodating transactions under balance of payments
If the Chinese economy could create all goods with fewer resources per unit than are needed in US, the citizens of China would: (i) Encompass a comparative advantage in the whole thing. (ii) Be self-sufficient since there would be no potential profits from trade. (iii
‘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?’
Fixed exchange rate system (or pegged exchange rate system): This is a system in which exchange rate of a currency is fixed by government. This system makes sure stability in the foreign trade and capital movement.
suppose that an investor has an extra cash reserve of $1000000 to invest for one year. annually rate is 10%
Which transactions find out the balance of trade? When the balance of trade is in surplus?
Induced investment: It is a type of investment that is of profit motive in nature.
Deficit in balance of trade point: Deficit in balance of trade points out that the imports of good are bigger than exports.
Differentiate among current account and capital account of balance of payment account. State any two transactions of capital account. Answer: Q : Problem related to Capitalism leisure The French phrase ‘laissez-faire’ almost translates as: (1) Enjoy your leisure. (2) Let the buyer be cautious. (3) All other things held steady. (4) Leave us alone. (5) Labor is a source of all the value. Q : Problem regarding Comparative advantage 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
The French phrase ‘laissez-faire’ almost translates as: (1) Enjoy your leisure. (2) Let the buyer be cautious. (3) All other things held steady. (4) Leave us alone. (5) Labor is a source of all the value. Q : Problem regarding Comparative advantage 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
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
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