A high home inflation rate relative to other countries would ____ the home country's current account balance, other things equal. A high growth in the home income level relative to other countries would ____ the home country's current account balance, other things equal.

If a country's government imposes a tariff on imported goods, that country's current account balance will likely____ (assuming no retaliation by other governments).

If the home currency begins to appreciate against other currencies, this should ____ the current account balance, other things equal (assume that substitutes are readily available in the countries, and that the prices charged by firms remain the same).

The "J curve" effect describes:

The balance of payments isa measurement of all transactions between domestic and foreign residents over aspecified period of time

Portfolio investment represents transactions involving long-term financial assets (such as stocks and bonds) between countries that do not affect the transfer of control.

A tariff is a maximum limit on imports

A balance of trade deficit indicates an excess of imports over exports.

A weakening of the U.S. dollar with respect to the British pound would likely reduce U.S. exports to the U.K. and increase U.S. imports from the U.K.

Although MNCs may need to convert currencies occasionally, they do not face any exchange rate risk, as exchange rates are stable over time.