A Canadian investor makes $10,000 in the form of a dividend payment from an American firm (think of a dividend as a type of income received from the ownership of a type of factor, e.g. capital). This money is deposited in a New York bank account. A U.S. hedge fund buys $1 million worth of German government bonds and pays for it by selling $1 million worth of French government stocks.
A Canadian investor makes $10,000 in the form of a dividend payment from an American firm (think of a dividend as a type of income received from the ownership of a type of factor, e.g. capital). This money is deposited in a New York bank account. A U.S. hedge fund buys $1 million worth of German government bonds and pays for it by selling $1 million worth of French government stocks.
Principles of Economics 2e
2nd Edition
ISBN:9781947172364
Author:Steven A. Greenlaw; David Shapiro
Publisher:Steven A. Greenlaw; David Shapiro
Chapter17: Financial Markets
Section: Chapter Questions
Problem 29CTQ: If you owned a small firm that had become somewhat established, but you needed a surge of financial...
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how will these scenarios impact the US balance of payments in regards to (CA AND FA accounts)?
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