International Finance Term Explanation

erm explanation:

Ch2

Marshall-Lerner condition:

BOP:

Narrow sense: the forex incomes & expenses in int’l trade at a certain period of time.

Broad sense: a systematic record of all the economic transactions between residents & non-residents at a certain period of time.

Statistical discrepancy: a balancing a/c to eliminate discrepancies caused by different sources of data &/or by consideration of secret keeping.

Unilateral transfer: An economic transaction between residents of two nations over a stipulated period of time, usually a calendar year. Typically, these transactions consist of gift exchanges, pension payments and the like, but they can encompass other goods and services as well.

Double-entry bookkeeping: all items of payments or expenses are recorded on debit (-) side, signifying the increase of assets & decrease of liabilities; all those of incomes are written on credit (+) side, indicating the increase of liabilities and decrease of assets.

Closed economy: An economy in which, no activity is conducted with outside economies. A closed economy is self-sufficient, meaning that no imports are brought in and no exports are sent out. The goal is to provide consumers with everything that they need from within the economy's borders.

National income accounting is a way of measuring total or aggregate production.

J curve: how the trade balance probably responds to a drop in the value of a country’s currency. Devaluation is more likely to improve the trade balance, the longer the span of elapsed time.

Cause：Adjustment of industrial structures, chains of exchange and circulation to suit the devaluation impossible to be finished soon, so export can hardly increase as soon as the home currency is devalued, even gets worse at the outset.