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GBM 381 Week 3 Individual Assignment

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Question

1. Indicate how each of the following international transactions is entered into the U.S. balance of payments with double-entry bookkeeping;(a) A U.S. resident imports $500 worth of merchandise from a U.K. resident and agrees to pay in three months.;(b) After the three months, the U.S. resident pays for his imports by drawing down his bank balances in London.;(c)What is the net effect of transactions (a) and (b) on the U.S. balance of payments if they occur during the same year?;2. Indicate how each of the following international transactions is entered into the U.S. balance of payments with double-entry bookkeeping;(a)The U.S. government gives a $100 cash balance in a U.S. bank to a developing nation as part of the U.S. foreign aid program.;(b)The developing nation uses the $100 bank balance to import $100 worth of food from the United States.;(c)What is the net effect of transactions (a) and (b) on the U.S. balance of payments if they occur during the same year?

 

Paper#24079 | Written in 18-Jul-2015

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