There Are Three Balance of Payments Accounts

question 37

Multiple Choice

There are three balance of payments accounts. The sum of the balances on these three accounts will equal

• A) the total amount of the nation's foreign borrowing.
• B) zero.
• C) the total amount of the nation's foreign lending.
• D) the total amount of the nation's exports.
• E) the total amount of the nation's imports.

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Definitions:

Marginal Rate of Substitution

The rate at which one good can be substituted for another by a consumer without affecting their overall utility level.

Wheat

A cereal grain grown worldwide and a staple food for a large part of the world's human population, used to make products like bread, pasta, and couscous.

Milk

A nutrient-rich fluid produced by the mammary glands of mammals, commonly consumed by humans and used in a variety of food products.

Pareto Optimal

A state of allocation of resources from which it is impossible to reallocate to make any individual or preference criterion better off without making at least one individual or preference criterion worse off.