Which Approach to Balance-Of-Payments Adjustment Suggests That Balance-Of-Payments Surpluses Are

question 8

Multiple Choice

Which approach to balance-of-payments adjustment suggests that balance-of-payments surpluses are the result of excess money demand in the home country?

• A) Absorption approach
• B) Elasticities approach
• C) Monetary approach
• D) Purchasing-power-parity approach

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Definitions:

Mutual Agency

A principle in partnership where each partner is both an agent and a principal, permitting each partner to bind the partnership in contract within the scope of the partnership’s business.

Unlimited Liability

A legal obligation where an individual's responsibility for debt extends beyond what they've invested in a business, potentially affecting personal assets.

Partners' Capital Statement

A financial report that shows the changes in each partner's equity in a partnership over a period of time.

Income Ratio

A financial metric comparing different aspects of income, such as net profit to sales, to assess profitability or performance.