3.1: Balance of Payments

The most important feature of a fixed exchange-rate system is that

central banks establish the values for their currencies

Which indicator is most important when it comes to determining the balance of payments and whether or not a nation is going into debt?

the balance of trade

What type of exchange rates system was the gold standard?

fixed

Jimmy Carter was the sitting American President who presided over the end of the US dollar being pegged to gold at $35 an ounce and other currencies valuation tied to that of the dollar.

False

A pivotal player at Bretton Woods in 1944, that gave rise to many post-World War II international institutions, was ___________________.

John Maynard Keynes

In the International Monetary system, trade is linked to money through

NOT the value of money

The primary purpose of the international monetary system is to

facilitate international monetary exchanges.

In the balance of payments accounting system, if a country

has a current account deficit, it must have a capital account surplus

In the balance of payments accounting system, if a country

has a current account surplus, it must have a capital account deficit

The most important feature of a floating exchange-rate system is that

markets establish the values for currencies

In a balance of payments accounting system, credits and debits must sum to ____________

zero