If the Current Account Is in Deficit and the Capital

question 111

Multiple Choice

If the current account is in deficit and the capital and financial account is also in deficit, then the official settlements account balance is

• A)negative.
• B)positive.
• C)probably close to zero, but could be either negative or positive.
• D)zero.
• E)equal to the sum of the current account and the capital account.

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Definitions:

Concentration Ratio

A measurement of the market share or output controlled by the largest firms within an industry, used to assess the level of competition.

Costly to Ship

Refers to items or materials that are expensive to transport, typically because of their weight, size, or special handling requirements.

Degree of Monopoly

Measures the level of market control and price-setting power possessed by a monopolist.

Very Localized

Referring to something that is confined to a very small or specifically defined geographic area or community.