Tuesday, September 15, 2015

Balance of Payments Activity

1.       Distinguish:
a.       Import and export:
                                                              i.      An import is a good or service brought in from abroad for sale (money out, good/service in). An export is a product or service sold abroad (money in, good/service out).
b.      Visible and invisible trade:
                                                              i.      Visible trade accounts for imports and exports of physical merchandise. Invisible trade accounts for business transactions that occur with no exchange of tangible goods. That includes customer service, intellectual property and patents.
2.       State whether the following are:
a.       A HK toy sold in UK
                                                              i.      Export
                                                            ii.      Visible
b.      French cheese sold in HK.
                                                              i.      Import
                                                            ii.      Visible
c.       A HK tourist holidaying in Thailand
                                                              i.      Import
                                                            ii.      Invisible
d.      Cathay Pacific buying planes from Airbus
                                                              i.      Import
                                                            ii.      Visible
e.      The HK Police Force buying Russian weapons
                                                              i.      Import
                                                            ii.      Visible
f.        An Australian tourist staying at HK Disneyland
                                                              i.      Export
                                                            ii.      Invisible
3.       In which part of the HK Balance of Payments account would the following transactions be recorded:
a.       A US company buying shares on the HK stock market
                                                              i.      The financial account: direct investment
b.      HK citizen sending wages earned in UK back to HK
                                                              i.      Current account: income
c.       A HK company selling prawns direct to France
                                                              i.      Financial account: direct investment
d.      An Italian firm investing in a chain of restaurants
                                                              i.      Financial account: direct investment
e.      HK company paying dividends to US shareholder
                                                              i.      Current account: income
4.       Which of the above transactions are inflows of money to HK (and are therefore credits on the balance of payments account) and which are outflows (and thus debits)?
a.       Credits: a, b, c
b.      Debits: e
5.       The fictitious figures below refer to HK’s balance of payments for 2007, 08, 09 and 2010 Calculate for each year
a.       Balance on trade in goods
                                                               i.      2007
1.       42345 – 57600 = -15255
                                                             ii.      2008
1.       123000 – 245786 = -122786
                                                            iii.      2009
1.       56363 – 66666 = -10303
                                                           iv.      2010
1.       853970 – 900000 = -46030
b.      Balance on trade in services
                                                               i.      2007
1.       654000 – 124000 = 530000
                                                             ii.      2008
1.       12789 – 9876 = 2913
                                                            iii.      2009
1.       46879 – 38945 = 7934
                                                           iv.      2010
1.       345876 – 200000 = 145876
c.       The balance of trade
                                                               i.      2007
1.       530000 – 15255 = 514745
                                                             ii.      2008
1.       2913 – 122786 = -119873
                                                            iii.      2009
1.       7934 – 10303 = -2369
                                                           iv.      2010
1.       145876 – 46030 = 99846
d.      The current account balance
                                                               i.      2007
1.       514745 – 12500 – 34000 = 468245
                                                             ii.      2008
1.       -119873 + 123765 + 47987 = 51879
                                                            iii.      2009
1.       -2369 + 100000 – 99999 = -92368
                                                           iv.      2010
1.       99846 + 34987 = 134833

2 comments:

  1. You bear through a awesome vacancy. I sanity definitely quarry it moreover personally suggest to my buddys. I am self-possessed they determination be benefited from this scene. £ to $ converter

    ReplyDelete
  2. GREAT TESTIMONY HOW I GOT MY LOAN I have a very important message to share with everyone that is in need of a loan from a genuine lender. I'm happy to share this note with everyone after what myself and my wife went through in the hands of some pathetic hoodlums claiming to offer some sort of loans. It's very difficult to get a genuine lender and thanks to Best Loan lender who helped me with the loan, Contact them if you are in need of a loan and come back to thank me later. I promise you they will not disappoint you. contact Email:- (pedroloanss@gmail.com Whatsapp +18632310632) Thanks.
    Nazgul William.....

    ReplyDelete