The balance of payments is an accounting identity, which says that capital _______ from one country must equal capital ________ to another country. *

a. depreciation; appreciation

b. investments; investments

c. outflows; inflows

d. assets; liabilities

Which of the following is something a country does with the dollars they get from selling products to the US: *

a. buy US treasury bills

b. invest in US companies

c. buy US goods and services

d. all of the above

Foreign investment entails __________ change in the capital account of the country making the investment. *

a. a negative

b. a positive

c. no

d. an uncertain

A current account deficit merely means that, as a country, we __________ more than we ___________. *

a. produce; consume

b. import; export

c. export; import

d. contract; expand

We are in a capital account _____________ when more capital flows into the country than flows out of the country. *

a. deficit

b) surplus

c) sterilization

d) control