Match the following definitions with the correct terms or phrases: Question 1 options: The receipts from exports minus the payments for imports. An increase in the value of a currency that is set under a fixed exchange rate regime. A situation in which exports exceeds imports. The doctrine according to which goods must sell for the same price in every country, implying that the nominal exchange rate reflects differences in price levels. An economy that does not trade goods, services, or assets with other countries. An exchange rate regime in which the government lets the exchange rate to go wherever the market takes it. A rise in the value of one currency in terms of other currencies. The rate at which one country's currency trades for another country's currency. The record of a nation's transactions (specifically, its net trade in goods and services, its net earnings on cross-border investments, and its net transfer payments) with the rest of the world over a defined period, such as a year or a quarter. An economy that trades goods, services, or assets with other countries. A fall in the value of one currency in terms of other currencies. Goods produced domestically and sold abroad. Spending on domestically produced goods by foreigners minus spending on foreign goods by domestic residents. Goods produced abroad and sold domestically. A situation in which imports exceeds exports. A situation in which the value of imports equals the value of exports, so net exports equal zero. The net flow of funds being invested abroad. The exchange rate adjusted for international differences in aggregate price levels. An exchange rate regime in which the government keeps the exchange rate against some other currency at or near a particular target. A reduction in the value of a currency that is set under a fixed exchange rate regime. 1. appreciation 2. balanced trade 3. closed economy 4. current account 5. depreciation 6. devaluation 7. exports 8. fixed exchange rate 9. floating exchange rate 10. imports 11. net capital outflow 12. net exports 13. nominal exchange rate 14. open economy 15. purchasing power parity 16. real exchange rate 17. revaluation 18. trade balance 19. trade deficit 20. trade surplus