If Rhoda in Hungary Buys Taffy from Matt in Maine

question 82

Multiple Choice

If Rhoda in Hungary buys taffy from Matt in Maine for $20,and Matt buys stock in his favorite goulash restaurant in Hungary for $20,then the U.S.:

• A)net exports and net capital outflow are both zero.
• B)net exports and net capital outflow both equal $20.
• C)net exports is zero and net capital outflow is $20.
• D)net exports equals $20 and net capital outflow is zero.

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Definitions:

Dividend Income

Income received from owning shares in a company, typically paid out of the company's profits.

Capital Gains

The profit made from the sale of an asset, such as stocks or property, which exceeds its original purchase price.

Target Payout Ratio

The percentage of net income that a firm aims to pay out to its shareholders as dividends.

Earnings

The amount of profit that a company produces during a specific period, indicative of its financial health and performance.