ECO 1002: Introduction to Macroeconomics - International Trade and Capital Flows

These flashcards cover key concepts in macroeconomics related to international trade and capital flows as presented by Dr. Scott Dressler.

GDP is calculated via the Expenditure Approach as __.

C + I + G + (X − M)

In the GDP equation, (X − M) represents __.

Net exports, which are exports minus imports.

When national savings exceeds private investment, it is referred to as __.

Net Lender.

A trade surplus occurs when __.

X − M > 0, meaning exports are greater than imports.

Public savings is calculated by __.

T − G, where T is tax revenue and G is government spending.

If T − G < 0, it indicates a __.

budget deficit.

National savings (S) can be calculated as __.

Private Savings + Public Savings.

When GDP = C + I + G + (X − M), it incorporates __.

The trade balance.

When a country is a net borrower, it implies that __.

Private investment exceeds national savings.

The term __ refers to financial capital flowing out of the country.

Net Capital Outflow.

Crowding out occurs when government deficit spending leads to __.

Fewer household savings available for private investment.

The equation S − I = __ indicates the relationship between national savings and private investment.

X − M.

If you had foreign currency and did not trade it, you would be limited in your ability to __ it.

Use or invest.

A downward sloping investment demand curve indicates that as interest rates rise, __.

Investment demand declines.

When foreigners invest in a country's financial markets, they need to obtain __ to do so.

US Dollars.

The implications of a trade deficit include income flowing to __.

Other countries.