Suppose the Current Account of a Country Is in Balance

question 44

Multiple Choice

Suppose the current account of a country is in balance and the official settlements account equals 0. A new transaction occurs so that the current account is now in surplus, but the official settlements account does not change. From this we know that

• A) the balance of trade is now in surplus.
• B) the government is running a budget deficit.
• C) the capital and financial account is now in deficit.
• D) the government must make official reserve transactions.

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Definitions:

Spontaneous Recovery

The reappearance of a learned response after extinction has occurred, following a period of no exposure to the conditioned stimulus.

Loud Noise

A sound with a high decibel level that can potentially cause hearing damage or discomfort.

Fear Conditioning

A behavioral paradigm in which organisms learn to predict aversive events, a form of associative learning where a neutral stimulus becomes associated with a fear-inducing event.

Human Infant

A very young child or baby in the earliest stage of life, particularly from birth to one year.