Because of the identity equation that relates to net exports, the in U.S. net exports is matched by in U.S. net capital outflow.
Which of the following is an example of how the United States might be affected in this scenario? Check all that apply.
A. You store the Thai baht in your safety deposit box at home.
B. You exchange the THB 80,000 for dollars at your local bank, which then uses the foreign currency to purchase stock in a Thai corporation.
C. You purchase THB 48,000 worth of stock in a Thai corporation and THB 32,000 worth of Thai bonds.
A. You store the Thai baht in your safety deposit box at home.
B. You exchange the THB 80,000 for dollars at your local bank, which then uses the foreign currency to purchase stock in a Thai corporation.
C. You purchase THB 48,000 worth of stock in a Thai corporation and THB 32,000 worth of Thai bonds.
1 answer:
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Answer:
Balance after 30 years = $151,018.50
Explanation:
In order to calculate this, we will calculate the future value on an amount invested, gaining interest over the years of investment, and this is given by:
where:
FV = future value
PV = present value
r = interest rate
t = time in years.
Hence the future value is calculated as follows:
1. For the first 10 years at 7% interest:
7% interest = 7/100 = 0.07
2. For the last 20 years at 9.5%(0.095) interest:
Note that for the remaining 20 years, the present value (PV) used = 24,589.392, as ending balance after the first 10 years
Total Future value earned = $151,018.50