Solved: Categories of transactions in the balance of payments, Macroeconomics

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Categories of transactions in the balance of payments

Question 1) Explain how each of the following will affect the relative values of the dollar and the French franc:

- Income growth higher in the United States than in France.

- Inflation higher in France than in the United States.

- A real interest rate higher in the United States than in France.

Question 2) What are the three categories of transactions in the balance of payments? Give an example of each.

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Macroeconomics: Categories of transactions in the balance of payments

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Macroeconomics: Categories of transactions in the balance of payments

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