Main content

Open economy: international trade and finance

AP Macro: MEA (BI), MEA‑4 (EU), MKT (BI), MKT‑5 (EU)

The balance of payments

AP Macro: MEA (BI), MEA‑4 (EU), MEA‑4.A (LO), MEA‑4.A.1 (EK), MEA‑4.A.2 (EK), MEA‑4.A.3 (EK), MEA‑4.A.4 (EK), MEA‑4.A.5 (EK), MEA‑4.A.6 (EK)
Learn
Balance of payments: Current account
(Opens a modal)
Data on Chinese US balance of payments
(Opens a modal)
Balance of payments: Capital account
(Opens a modal)
Using a person's budget to understand the balance of payments
(Opens a modal)
Lesson summary: The balance of payments
(Opens a modal)
Practice
The balance of paymentsGet 3 of 4 questions to level up!

Exchange rates

AP Macro: MKT (BI), MKT‑5 (EU), MKT‑5.A (LO), MKT‑5.A.1 (EK), MKT‑5.A.2 (EK)
Learn
Exchange rate primer
(Opens a modal)
Lesson Summary: Exchange rates
(Opens a modal)
Practice
Exchange ratesGet 5 of 7 questions to level up!

The foreign exchange market

AP Macro: MKT (BI), MKT‑5 (EU), MKT‑5.B (LO), MKT‑5.B.1 (EK), MKT‑5.B.2 (EK), MKT‑5.C (LO), MKT‑5.C.1 (EK), MKT‑5.D (LO), MKT‑5.D.1 (EK)
Learn
Currency exchange introduction
(Opens a modal)
Supply and demand curves in foreign exchange
(Opens a modal)
Lesson summary: the foreign exchange market
(Opens a modal)
Practice
The foreign exchange marketGet 3 of 4 questions to level up!

Effect of changes in policies and economic conditions on the foreign exchange market

AP Macro: MKT (BI), MKT‑5 (EU), MKT‑5.E (LO), MKT‑5.E.1 (EK), MKT‑5.E.2 (EK) , MKT‑5.E.3 (EK)
Learn
Causes of shifts in currency supply and demand curves
(Opens a modal)
Lesson summary: effect of changes in policies and economic conditions on the foreign exchange market
(Opens a modal)
Practice
Foundational concepts: determinants of currency supply and currency demandGet 5 of 7 questions to level up!
Effect of changes in policies and economic conditions on the foreign exchange marketGet 3 of 4 questions to level up!

Changes in the foreign exchange markets and net exports

AP Macro: MKT (BI), MKT‑5 (EU), MKT‑5.F (LO), MKT‑5.F.1 (EK), MKT‑5.F.2 (EK)
Learn
Introduction to currency exchange and trade
(Opens a modal)
Lesson summary: Changes in the foreign exchange markets and net exports
(Opens a modal)
Practice
Changes in the foreign exchange markets and net exportsGet 3 of 4 questions to level up!

Real Interest Rates and International Capital Flows

AP Macro: MKT (BI), MKT‑5 (EU), MKT‑5.G (LO), MKT‑5.G.1 (EK), MKT‑5.G.2 (EK)
Learn
Interest rate changes in one country and currency values, the balance of payments, and exports.
(Opens a modal)
Real interest rates and international capital flows
(Opens a modal)
Practice
Real interest rates and international capital flowsGet 5 of 7 questions to level up!

About this unit

In this unit, you'll learn about open economies, how a country’s transactions with the rest of the world are recorded in the balance of payments accounts, how market forces and public policy affect the foreign exchange market, and how changes in net exports and financial capital flows affect financial and goods markets.