answer ALL answer and show ALL work The following table record international tra
ID: 1198176 • Letter: A
Question
answer ALL answer and show ALL work
The following table record international transactions of the United States. Find the missing value. Show your work.
1. The merchandise-trade balance is _______.
2. The service balance is _________.
3. The unilateral-transfers balance is______.
4. The current-account balance is________.
5. The net exports component of the U.S. gross domestic product is________.
6. The payments data suggest that the United States was a "net demander" of ___________ from the rest of the world.
Transaction Amount (billions of dollars) allocation of SDRs 10 changes in the U.S. assets abroad 100 statistical discrepancy -15 merchandise imports -400 payments and foreign assets in U.S. -20 Remittances, peensions, transfers -60 travel and transportations receipts, net 30 military transactions, net -10 investment income, net 100 merchandise exports 350 U.S. goverment grants (excluding military) -20 changes in foreign assets in the U.S. 190 other services, net 80 receipts on U.S. investments abroad 30Explanation / Answer
Q1. Calculate merchandise trade balance -
Merchandise exports = $350 billion
Merchandise imports = $400 billion
Merchandise trade balance = Merchandise exports - Merchandise imports
= $350 billion - $400 billion
= - $50 billion
The merchandise trade balance is -$50 billion.
This negative figure indicates that United States is having merchandise trade deficit of $50 billion.
Q2. Calculate Service balance -
Service balance = Total exports of services - Total imports of services
However, in given case we have already been provided the net figures.
So,
Service balance = Net travel and transportation services + net other services
= $30 billion + $80 billion
= $110 billion
Thus, Service balance of United States is $110 billion.
Q3. Calculate Unilateral-transfers balance -
Unilaterla transfers balance = (Remittances, pensions, and transfers) + US governbment grants
= -$60 billion + (-$20 billion)
= -$80 billion
The Unilateral transfers balance of United States is -$80 billion.
Q4. Calculate Current account balance -
Current account balance = Merchandise trade balance + Services balance + receipts on U.S. invetsments abroad + Net investment income + Net military transactions + Unilateral trade balance - payments on foriegn assets in U.S.
Current account balance = -$50 billion + $110 billion + $30 billion + $100 billion - $10 billion - $80 billion - $20 billion
Current account balance = $80 billion
The Current account balance of United States is $80 billion.
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