Econ- 7.3 Formative Assessment- Option 1

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A trade surplus occurs when a country is ​

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more than it is ​

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.

Fill in the Blanks

A country’s Balance of Trade moves toward a trade surplus anytime

flows into the country, everything else remaining constant.

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150,000 barrels of oil are shipped into the US from Yemen. Money is flowing out of the US to Yemen in exchange for oil going from Yemen to the US; The US’s Balance of Trade moves toward a trade

.

Dropdown

Categorize each of the following international exchange as either causing the US Balance of Trade to move  toward a TRADE SURPLUS or TRADE DEFICIT.



1. Ethiopian coffee producers sell 10,000 pounds of coffee to a US-based coffee shop.

Answer:​

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2. Best Buy purchases 50,000 TVs from Sony, a Japanese company.

Answer: ​

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3. British Airways, buys 20 747s airplanes from Boeing, an airplane manufacturer, based in Seattle, WA.

Answer: ​

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4. Target, a Minnesota-based company, buys $10,000,000 worth of clothing from a South Korean clothing company.

Answer: ​

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Multiple Choice

Properly categorize each international transaction in 2 ways:

1 - Identify if the transaction should be counted in the CURRENT ACCOUNT or FINANCIAL/CAPITAL ACCOUNT 

  2 - Determine if it is a CREDIT or DEBIT for the US.

Transaction: Amy, who is retired and lives in Ecuador, receives her Social Security check from the US government each month.

• Current Accout; Credit

• Current Account; Debit

• Financial/Capital Account; Credit

• Financial/Capital Account; Debit

Multiple Choice

Properly categorize each international transaction in 2 ways:

1 - Identify if the transaction should be counted in the CURRENT ACCOUNT or FINANCIAL/CAPITAL ACCOUNT 

  2 - Determine if it is a CREDIT or DEBIT for the US.

Transaction: Louise, a French investor, buys $10,000 worth of US Government bonds.

• Current Accout; Credit

• Current Account; Debit

• Financial/Capital Account; Credit

• Financial/Capital Account; Debit

Multiple Choice

Properly categorize each international transaction in 2 ways:

1 - Identify if the transaction should be counted in the CURRENT ACCOUNT or FINANCIAL/CAPITAL ACCOUNT 

  2 - Determine if it is a CREDIT or DEBIT for the US.

Transaction: BMW pays $1 million to a US shipper for transporting cars from Germany to the US.

• Current Accout; Credit

• Current Account; Debit

• Financial/Capital Account; Credit

• Financial/Capital Account; Debit

Multiple Choice

Properly categorize each international transaction in 2 ways:

1 - Identify if the transaction should be counted in the CURRENT ACCOUNT or FINANCIAL/CAPITAL ACCOUNT 

  2 - Determine if it is a CREDIT or DEBIT for the US.

Transaction: Kevin, a Texas-based real-estate investor, buys an office building in downtown Tokyo, Japan.

• Current Accout; Credit

• Current Account; Debit

• Financial/Capital Account; Credit

• Financial/Capital Account; Debit

Multiple Choice

Properly categorize each international transaction in 2 ways:

1 - Identify if the transaction should be counted in the CURRENT ACCOUNT or FINANCIAL/CAPITAL ACCOUNT 

  2 - Determine if it is a CREDIT or DEBIT for the US.

Transaction: Shelia, a resident of New York City, recieves a $300 devidend payment from her prevoious purchase on stock in a South Korean company.

• Current Accout; Credit

• Current Account; Debit

• Financial/Capital Account; Credit

• Financial/Capital Account; Debit