Which One of the Following Is Not a Major Factor

question 72

Multiple Choice

Which one of the following is not a major factor that contributed to large trade deficits in the United States in the period 2002-2007?

• A) a declining saving rate coupled with a rising investment rate in the U.S.
• B) a U.S. economy growing faster than its trading partners
• C) large trade deficits with OPEC economies
• D) flexible exchange rate between the U.S. dollar and the Chinese yuan

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Definitions:

Premium

The amount by which the price of a security exceeds its principal amount or its value at issuance.

Discount

The reduction from the full amount or value of something, especially the price of a financial instrument or merchandise.

Coupon Rate

The annual interest rate paid by a bond as a percentage of the face value, indicating the income investors can expect to receive.

Interest Rates

The percentage of a sum of money charged for its use, often expressed as an annual percentage.