Jennifer
Name: _______________
Worksheet for Chap 31
D1177025
Student ID:____________
capital outflow - capital
1. Net capital outflow (NCO) is defined as _____________________.
inflow
2. NCO in Taiwan is ___________(negative/positive), and trade surplus is
________(negative/positive).
NX
3. Open economy: Y = C + I + G + ______.
National saving: S = Y – C – G
NX
Y – C – G = I + ____
NX
I ______
S = ____+
NCO
NX = ______.
NCO
S = I + ______.
4. Net exports > 0
Y is ____(larger/smaller) than Domestic spending (C+I+G)
S is ____(larger/smaller) than I.
5.
If one U.S. dollar can exchange for 30 NT dollars, the exchange rate is ______.
If one NT$ can exchange for 3 Japanese Yen( ¥), the exchange rate is ______.
6.
If the exchange rate goes up, the local currency ________(appreciates/depreciates).
If the exchange rate goes down, the local currency ________.
7.
When local currency depreciates, the same amount of foreign currency can buy
_____ (more/less) of local goods, which would help the export.
8.
Real exchange rate is defined as :
______________
If one big Mac costs $3 in U.S., ¥ 400 in Japan, and e is ¥100 per $.
The real exchange rate is equal to __________.
9.
When local goods are cheaper relative to foreign goods, real exchange rate will go
________(up/down).
10.
Purchasing-power parity(PPP) is based on the law of _________ which suggests that
a good must sell for the same price in all locations. In other word, there is no chance
of _________.
11.
PPP implies the real exchange is equal to _______, and the nominal exchange rate is
equal to __________.
12.
What is the limitations of PPP?