1. What is the main idea of the chapter on open economy macroeconomics?

2. When we start assuming an economy is 'open economy', we start to assume there is a flow of goods and services and capital (in and out) from or to a country.

3. Explain briefly net outflow position under few different circumstances which are: i) trade deficit, ii) trade balance and ii) trade surplus

4. What is currency appreciation and depreciation? What causes both to happen?

5. What is real exchange rate?

6. Explain briefly the concept of purchasing power parity.