宏观经济学-ch10

Salvatores Introduction to International Economics, 2nd EditionInstructors Manual*CHAPTER 10(Core Chapter)BALANCE OF PAYMENTSOUTLINE10.1 Introduction10.2 The Balance of Payments: Definition and Use10.3 Balance-of-Payments Accounting Principles: Credits and Debits10.4 Double-Entry Bookkeeping10.5 The International Transactions of the United StatesCase Study 10-1 The Major Goods Exports and Imports of the United States10.6 Accounting Balances and Disequilibrium in International Transactions10.7 Measuring Deficits or Surpluses in the Balance of Payments10.8 The Postwar Balance of Payments of the United StatesCase Study 10-2 The Major Trade Partners of the United StatesCase Study 10-3 The Exploding U.S. Trade Deficit with China10.9 The International Investment Position of the United StatesCase Study 10-4 The Deterioration of the U.S. Current Account Balance and Net International Investment PositionCase Study 10-5 The United States as a Debtor NationKEY TERMSBalance of paymentsCurrent accountCredit transactionsCapital accountDebit transactionsDeficit in the balance of paymentsCapital inflowOfficial reserve accountCapital outflowSurplus in the balance of paymentsDouble-entry bookkeepingOfficial settlements balanceUnilateral transfersAutonomous transactionsStatistical discrepancyAccommodating transactionsInternational investment positionLECTURE GUIDE1. In the first lecture, I would cover sections 1-4. The average student usually finds the meaning of capital inflows and outflows particularly difficult to understand. Therefore, I would pay special care in presenting the material in section 3. I would also assign problems 1-8.2. In the second lecture, I would go over problems 1-8 and cover sections 5-7 and stress the meaning and measurement of balance of payments deficits and surpluses.3. In the third lecture, I would cover sections 8 and 9. Case studies 10-2 to 10-5 are likely to provide interesting class discussion.ANSWERS TO REVIEW QUESTIONS AND PROBLEMS1.a. The U.S. debits its current account by $500 (for the merchandise imports) and credits capital by the same amount (for the increase in foreign assets in the U.S.).b. The U.S. credits capital by $500 (the drawing down of its bank balances in London, a capital inflow) and debits capital by an equal amount (to balance the capital credit that the U.S. importer received when the U.K. exporter accepted to be paid in three months).c. The U.S. is left with a $500 debit in its current account and a net credit balance of $500in its capital account.2.a. The U.S. debits unilateral transfers by $100 and credits capital by the same amount.b. The U.S. credits its current account by $100 and debits capital by the same amount.c. The debit of $100 in unilateral transfers and the credit of $100 in current account.3.a. The same as 2a.b. The net result is the same, but the transaction in part a of this problem refers to tied aid while transactions a and b in problem 2 do not.4. The U.S. debits capital account by $1,000 (for the purchase of the foreign stock by the U.S. resident) and also credits the capital account (for the drawing down of the U.S. resident bank balances abroad) by the same amount.5. The U.S. credits its current account by $100 and debits its capital account by the same amount.6.The U.S. credits its capital account by $400 (for the purchase of the U.S. treasury bills by the foreign resident) and debits its capital account (for the drawing down of the foreign residents bank balances in the United States) for the by the same amount.7.The U.S. debits its current account by $40 for the interest paid, debits its capital account by $400 (for the capital outflow for the repayment of the repayment of the principal to the foreign investors by the U.S. borrower), and then credits its capital account by $440 (the increase in foreign holdings of U.S. assets, a credit).8.a. The U.S. credits its capital account by $800 and debits its official reserves account by the same amount.b. The official settlements balance of the U.S. will improve (i.e., the U.S. deficit will fall or its surplus will rise) by $800.9.See the July Issue of the Survey of Current Business for the most recent year.10.a. The benefit that the United States received from becoming a net debtor nation is that the United States utilized foreign capital to finance some of its investments (thus allowing it to grow faster) and some of its public consumption (public debt) without the need to increase interest rates, which would have slowed growth.b. The risk that the United States faces in becoming a net debtor nation is that foreigners may suddenly stop investing in the United States and financing the public debt. That would cause a financial crisis in the United States and a sharp increase in interest rates.SAMPLE TEST QUESTIONS1.Which of the following is false?a.a credit transaction leads to a payment from foreignersb.a debit transaction leads to a payment to foreignersc.a credit transaction is entered with a negative signd.double-entry bookkeeping refers to each transaction entered twice2.Which of the following is a debit?a.the export of goodsb.the export of servicesc.unilateral transfers given to foreignersd.capital inflows3.Capital inflows:a.refer to an increase in foreign assets in the nationb.refer to a reduction in the nations assets abroadc.lead to a payment from foreignersd.all of the above4.When a U.S. firm imports goods to be paid in three months the U.S. credits:a.the current accountb.unilateral transfersc.capitald.official reserves5.The receipt of an interest payment on a loan made by a U.S. commercial bank to a foreign resident is entered in the U.S. balance of payments as a:a.credit in the capital accountb.credit in the current accountc.credit in official reservesd.debit in unilateral transfers6.The payment of a dividend by an American company to a foreign stockholder represents:a.a debit in the U.S. capital accountb.a credit in the U.S. capital accountc.a credit in the U.S. official reserve accountd.a debit in the U.S. current account7.When a U.S. firm imports a good from England a pays for it by drawing on its pound sterling balances in a London Bank, the U.S. debits its current account and credits its:a.official reserve accountb.unilateral transfers accountc.services in its current accountd. capital account8.When the U.S. ships food aid to a developing nation, the U.S. debits:a.unilateral transfersb.servicesc.capitald.official reserves9.When the resident of a foreign nation (1) sells a U.S. stock and (2) deposits the proceeds in a U.S. bank, the U.S.:a.credits capital for (1) and debits capital for (2)b.credits the current account and debits capitalc.debits capital and credits official reservesd.debits capital for (1) and credits capital for (2)10.When a U.S. resident (1) purchases a foreign treasury bill and pays by (2) drawing down hisbank balances abroad:a.debits short-term capital and credits official reservesb.debits capital for (1) and credits capital for (2)c.debits official reserves and credits capitald.credits short-term capital and debits official reserves11.From the U.S. point of view, drawing on (reducing) foreign bank balances in a New York bank represents a:a.capital inflowb.capital outflowc.outflow of official reservesd.debit in the current account12.The capital account of the U.S. includes:a.the change in U.S. assets abroad and foreign assets in the U.S.b.the change in U.S. assets abroad and foreign assets in the U.S., other than official reserve assetsc.all financial assetsd.all but current account transactions13.Accommodating items are:a.transactions in official reserve assetsb.the items below the linec.need