Need help with these(ignore cut out part)

2. The Balance of Payments (BOP) measures all international transactions between two countries. The chart below shows six different transactions between the US and China United States China Purchased $800 of goods and services Chinese tourists spend $1000 in the US Sent $100 of humanitarian aid Purchased $300 of goods and services . . . Americans spent $200 in Chinese stock market Chinese purchased a $600 business in the US American tourists spend $1000 in China Chinese government purchased US. bonds a. Which country has a trade deficit and which has a trade surplus? Explain how you got your answer and calculate the value of each ( 15 ) b. Assuming these are all the transactions between these two countries, calculate the value of the current accounts for each country. Explain why one will have a current account deficit and the other will have a current account surplus. ( /5) C. Calculate the dollar value of US bonds held by the Chinese government. Explain how you determined your answer. Identify the relationship between financial inflows and outflows for each country ( 15) d. Assume that China experience significant inflation compared to the US. In general, explain what would likely happen to the current accounts for each country and the value of each country's currency? ( 15) e. Assume instead that the interest rate increase in China compared to the US. In general, explain what would likely happen to financial accounts for each country and the value of each country's currency 15 ) 3. /30 Points) Practice FRQs a. Unit 6 Study Guide from the Ultimate Review Packet (20 Points) DI / molonhand C. 1, Dalanna of Doumento Announce ( 152 2. Assume that South Korea and Canada are trading partners. Complete the following regarding the Canadian dollar and the South Korean currency, the won. (a) Draw a correctly labeled graph for the foreign exchange market for the Canadian dollar. (b) Explain how each of the following will affect the demand for the Canadian dollar. i. The inflation rate in Canada is higher than the inflation rate in South Korea ii. Real interest rates in Canada fall relative to real interest rates in South Korea (c) Given your answer in part (b) (1i), indicate how the value of the Canadian dollar is affected (d) As a result of the currency change in part (c), what will happen to Canadian exports to South Korea? Explain