Persistent Current Account Deficits in the United States

question 115

Multiple Choice

Persistent current account deficits in the United States

• A)can be seen as a vote of confidence in the strength of the U.S.economy.
• B)cause persistent declines in investment in the United States.
• C)cause U.S.investors to accumulate more foreign assets than foreign investors accumulate U.S.assets.
• D)will eventually cause the value of the dollar to rise.

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Definitions:

Yield

The income return on an investment, expressed as a percentage of the investment’s cost or current value.

Applied Factory Overhead

The allocation of factory overhead costs to units produced, based on a predetermined rate or method.

Direct Materials

Raw materials that can be directly attributed to the production of a specific product, constituting a significant part of manufacturing cost.

Continuous Process

A production system where materials are processed and manufactured in a non-stop, consistent manner.