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If a USFirm Buys Tulips from a Dutch Firm and the Dutch

question 4

Multiple Choice

If a U.S.firm buys tulips from a Dutch firm and the Dutch firm uses the dollars it gets to buy U.S.stocks,the U.S.trade balance ________ and the U.S.capital and financial account ________.


Definitions:

Consumption

The use of goods and services by households, representing the end phase of the economic process as goods are utilized to fulfill needs or wants.

Income

Money received, especially on a regular basis, for work or through investments.

Directly Related

A relationship between two variables in which they move in the same direction.

Consumer's Income

The sum of money a consumer can spend on products and services.

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