Label each of the following statements true, false, or uncertain. Explain briefly. a. If there are no

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Label each of the following statements true, false, or uncertain. Explain briefly.

a. If there are no statistical discrepancies, countries with current account deficits must receive net capital inflows.

b. Although the export ratio can be larger than one-as it is in Singapore- the same cannot be true of the ratio of imports to GDP.

c. The fact that a rich country like Japan has such a small ratio of imports to GDP is clear evidence of an unfair playing field for US exporters to Japan.

d. Uncovered interest parity implies that interest rates must be the same across countries.

e. The nominal exchange rate in this chapter is defined as the domestic currency price of a unit of foreign currency.

f. The nominal exchange rate and the real exchange rate always move in the same direction.

g. The nominal exchange rate and the real exchange rate usually move in the same direction.

h. If the dollar is expected to appreciate against the yen, uncovered interest parity implies that the US nominal interest rate must be greater than the Japanese nominal interest rate.

i. Given the definition of the exchange rate adopted in this chapter, if the dollar is the domestic currency and the euro the foreign currency, a nominal exchange rate of 0. 75 means that 0. 75 dollars is worth one euro.

j. A real appreciation means that domestic goods become less expensive relative to foreign goods.

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Macroeconomics

ISBN: 9780134897899

8th Edition

Authors: Olivier Jean Blanchard

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