Week 7 assignment Please submit your answers electronically (t.docx
- 1. Week 7 assignment Please submit your answers electronically (to your assignment folder). This assignment is worth 100 points. Chapter 20: International Trade 1. The United States has a trade deficit in (goods, services) _______ and a trade surplus in (goods, services) ________. 2. Nations tend to trade among themselves because the distribution of economic resources among them is (even, uneven) _______, the efficient production of various goods and services necessitates (the same, different) _______ technologies or combinations or resources, and people prefer (more, less) _______ choices in products. 3. The basic argument for free trade based on the principle of (bilateral negotiations, comparative advantage) ______ is that is results in a (more, less) _______ efficient allocation of resources and a (lower, higher) _______ standard of living. 4. Excise taxes on imported products are (quotas, tariffs) _______, whereas limits on the maximum amount of a product that can be imported are import (quotas, tariffs) _______. Tariffs applied to a product not produced domestically are (protective, revenue) _______ tariffs, but tariffs designed to shield domestic producers from foreign competition are (protective, revenue) _______ tariffs. 5. Nations erect barriers to international trade to benefit the economic positions of (consumers, domestic producers) _______ even though these barriers (increase, decrease) _______ economic efficiency and trade among nations and the benefits to that nation are (greater, less) _______ than the costs
- 2. to it. 6. Using trade barriers to permit diversification for stability in an economy is not necessary for (advanced, developing) _______ economies such as in the United States, and there may be great economic costs to forcing diversification in (advanced, developing) ________ nations. Questions 7 through 10 refer to the following tables. Japan Production Possibilities Table Production alternatives Product A B C D E F Computers 0 4 8 12 16 20 Perfume 40 32 24 16 8 0 France Production Possibilities Table
- 3. Production alternatives Product A B C D E F Computers 0 3 6 9 12 15 Perfume 60 48 36 24 12 0 7. The data in the tables show that production in A. Both Japan and France are subject to increasing opportunity costs B. Both Japan and France are subject to constant opportunity costs C. Japan is subject to increasing opportunity costs and France to constant opportunity costs D. France is subject to increasing opportunity costs and Japan to constant opportunity costs 8. If Japan and France engage in trade, the terms of trade will
- 4. be A. Between 2 and 4 units of perfume for 1 computer B. Between 1/3 and ½ computers for 1 perfume C. Between 3 and 4 computers for 1 perfume D. Between 2 and 4 computers for 1 perfume 9. Assume that prior to specialization and trade Japan and France choose production possibility C. Now if each specializes according to its comparative advantage, the resulting gains from specialization and trade will be A. 6 computers B. 8 computers C. 6 computers and 8 units of perfume D. 8 computers and 6 units of perfume 10. Each nation produced only one product in accordance with its comparative advantage, and the terms of trade were set at 3 units of perfume for 1 computer. In this case, Japan could obtain a maximum combination of 8 computers and A. 12 units of perfume B. 24 units of perfume C. 36 units of perfume D. 48 units of perfume 11. What happens to a nation’s imports or exports of a product when the world price of the product rises above the domestic
- 5. price? A. Imports of the product increase B. Imports of the product stay the same C. Exports of the product increase D. Exports of the product decrease 12. What happens to a nation’s imports or exports of a product when the world price of the product falls below the domestic price? A. Imports of the product increase B. Imports of the product decrease C. Exports of the product increase D. Exports of the product stay the same 13. Which is the likely result of the United States using tariffs to protect its high wages and standard of living from cheap foreign labor? A. An increase in U.S. exports B. A rise in the U.S. real GDP C. A decrease in the average productivity of U.S. workers D. A decrease in the quantity of labor employed by industries producing the goods on which tariffs have been levied 14. What international agency is charged with overseeing trade liberalization and with resolving disputes among nations?
- 6. A. World Bank B. United Nations C. World Trade Organization D. International Monetary Fund Questions 15 through 17 are based on the following table which shows the domestic supply and demand schedule for nation A. The first column of the table is the price of a product. The second column is the quantity demand domestically (Qdd). The third column is the quantity supplied domestically (Qsd). The fourth column is the quantity demanded for imports (Qdi). The fifth column is the quantity of exports supplied (Qse). Nation A Price Qdd Qsd Qdi Qse $3.00 100 300 0 200 2.50 150 250 0 100 2.00 200 200 0
- 7. 0 1.50 250 150 100 0 1.00 300 100 200 0 15. At a price of $2.00, there (will, will not) _______ be a surplus or shortage and there (will, will not) _______ be exports or imports. 16. At a price of $3.00, there will be a domestic (shortage, surplus) _______ of _______ units. This will be eliminated by (exports, imports) _______ of _______ units. 17. At a price of $1.00, there will be a domestic (shortage, surplus) _______ of _______ units. This will be eliminated by (exports, imports) _______ of _______ units. 18. Compare and contrast the economic effects of a tariff with the economic effect of an import quota on a product. Chapter 21: The Balance of Payments, Exchange Rates, and Trade Deficits 19. The balance of payments of a nation records all payments (domestic, foreign) _______ residents make to and receive from (foreign, domestic) _______ residents. Any transaction that earns foreign exchange for that nation is a (debit, credit) ______, and any transaction that uses up foreign exchange is a (debit, credit) _______. A debit is shown with a (+, -) _______ sign, and a credit is shown with a (+,-) _______ sign.
- 8. 20. If a nation has a deficit in its balance of goods, its exports of goods are (great, less) _______ than its imports of goods. If a nation has a surplus in its balance of services, its exports of services are (greater, less) _______ than its imports of service. If a nation has a deficit in its balance on goods and services, its exports of these items are (great, less) _______ than its imports of them. 21. The current account is equal to the balance on goods and services (plus, minus) _______ net investment income and net transfers. When investment income received by U.S. individuals and businesses from foreigners is greater than investment income Americans pay to foreigners, then net investment income is a (negative, positive) _______ number; when transfer payments from the United States to other nations are greater than transfer payments from other nations to the United States, then net transfers are a (negative, positive) _______ number. 22. If foreign exchange rates float freely and a nation has a balance-of-payments deficit, that nation’s currency in the foreign exchange markets will (appreciate, depreciate) _______ and foreign currencies will (appreciate, depreciate) ________ compared to it. As a result of these changes in foreign exchange rates, the nation’s imports will (increase, decrease) _______, its exports will (increase, decrease) _______, and the size of its deficit will (increase, decrease) _______. 23. Under a fixed-exchange-rate system, a nation with a balance-of-payments deficit might attempt to eliminate the deficit by (taxing, subsidizing) ________ imports or by (taxing, subsidizing) _______ exports. The nation might use exchange controls and ration foreign exchange among those who wish to (export, import) _______ goods and services and require all those who (export, import) _______ goods and services to sell the foreign exchange they earn to the (businesses, government)
- 9. ________. 24. U.S. residents demand foreign currencies to A. Produce goods and services exported to foreign countries B. Pay for goods and services imported from foreign countries C. Receive interest payments on investments in the United States D. Have foreigners make real and financial investments in the United States 25. Which statement is correct about a factor that causes a nation’s currency to appreciate or depreciate in value? A. If the supply of a nation’s currency decreases, all else equal, that currency will depreciate B. If the supply of a nation’s currency increases, all else equal, that currency will depreciate C. If the demand for a nation’s currency increases, all else equal, that currency will depreciate D. If the demand for a nation’s currency decreases, all else equal, that currency will appreciate 26. If a nation had a balance-of-payments surplus and exchange rate floated freely, the foreign exchange rate for its currency would A. Rise, its exports would increase, and its imports would decrease B. Rise, its exports would decrease, and its imports would
- 10. increase C. Fall, its exports would increase, and its imports would decrease D. Fall, its exports would decrease, and it imports would increase 27. Floating exchange rates A. Tend to correct balance-of-payments imbalances B. Reduce the uncertainties and risks associated with international trade C. Increase the world’s need for international monetary reserves D. Tend to have no effect on the volume of trade Questions 28 through 31 are based on the following table, which shows supply and demand schedules for the British pound. Quantity of pounds supplied Price Quantity of pounds demanded 400 $5.00 100 360 4.50 200 300 4.00 300 286 3.50
- 11. 400 267 3.00 500 240 2.50 620 200 2.00 788 28. If the exchange rates are flexible, what will be the rate of exchange for the pound? 29. If the exchange rates are flexible, what will be the rate of exchange for the dollar? 30. How many pounds will be purchased in the market? 31. How many dollars will be purchased in the market? 32. How can flexible foreign exchange rates eliminate balance- of-payments deficits and surpluses? 33. Explain what is meant by a managed floating system of foreign exchange rates. Chapter Twenty-one outline 1. International financial transactions are used for two purposes. First, there is the international trade of goods and services, such as food or insurance that people buy or sell for money. Second there is the international exchange of financial assets, such as real estate, stocks, or bonds that people also buy or sell with money. International trade between nations or the international exchange or assets differs from domestic trade or asset
- 12. exchanges because the nations use different currencies. This problem is resolved by the existence of foreign exchange markets, in which the currency used by one nation can be purchased and paid for with the currency of the other nation. 2. The balance of payments for a nation is a summary of all the financial transactions with foreign nations; it records all the money payments received from and made to foreign nations. Most of the payments in the balance of payments accounts are for exports or imports of goods and services or for the purchase or sale of real and financial assets. The accounts show the inflows of money to the United States and the outflows of money from the United States. For convenience, both the inflows and outflows are stated in terms of U.S. dollars so they can be easily and consistently measured. a. The current account section of a nation’s balance of payments records the imports and exports of goods and services. Within this section (1) the balance on goods of the nation is equal to its exports of goods minus its imports of goods; (2) the balance on services of the nation is equal to its exports of services minus its imports of services; (3) the balance on goods and services is equal to its exports of goods and services minus its imports of goods and services (if the balance is positive there is a trade surplus and if it is negative there is a trade deficit); and (4) the balance on the current account is equal to its balance on goods and services and two other “net” items (which can be positive or negative)/ First there is net investment income (such as dividends and interest) which is the difference in investment income received from other nations minus any investment income paid to foreigners. Second, there are net private and public transfers, which is the difference between such transfers to other nations minus any transfers from other nations. This balance on the current account may be positive, zero, or negative.
- 13. b. International asset transactions are shown in the capital and financial account of a nation’s balance of payments. (1) The capital account primarily measures debt forgiveness and is a “net” account. If Americans forgave more debt owed to them by foreigners than foreigners forgave debt owed to them by Americans, then the capital account would be entered as a negative. (2) The financial account shows foreign purchases of real and financial assets in the United States. This item brings a flow of money into the United States, so it is entered as a plus in the capital account. U.S. purchases of real and financial assets abroad result in a flow of money from the United States to other nations, so this item is entered as a minus in the capital account. The nation has a surplus in its financial account if foreign purchases of U.S assets (and its inflow of money) are greater than U.S. purchases of assets abroad (and its outflow of money). The nation has a deficit in its financial account if foreign purchases of U.S. assets are less than U.S. purchases of assets abroad. The balance on the capital and financial account is the difference between the value of the capital account and the value of the financial account. c. The balance of payments must always sum to zero. For example, any deficit in the current account would be offset by a surplus in the capital and financial account. The reason that the accounts balance is that people trade currently produced goods and services or preexisting assets. If a nation imports more goods and services than it exports, then the deficit in the current account (and outflow of money) must be offset by sales of real and financial assets to foreigners (and inflow of money). d. Sometimes economists and government officials refer to balance-of-payments deficits or surpluses. Whether a nation has a balance-of-payments deficit or surplus depends on what happens to its official reserves. These reserves are central bank holdings of foreign currencies, reserves at the International Monetary Fund, and stocks of gold. (1) A nation has a balance-of-payments deficit when an
- 14. imbalance in the combined current account and capital and financial account leads to a decrease in official reserves. These official reserves are an in-payment to the capital and financial account. (2) A balance-of-payments surplus arises when an imbalance in the combined current account and capital and financial account results in an increase in official reserves. These official reserves become an out-payment from the capital and financial account. (3) Deficits in the balance-of-payments will happen over time and they are not necessarily bad. What is of concern, however, for any nation is whether the deficits are persistent over time because in that case they require that a nation continually draw down its official reserves. Such official reserves are limited and if they are depleted, a nation will have to adopt tough macroeonomic policies. In the case of the United States, there are ample official reserves and their depletion is not a major concern. 3. There are two basic types of exchange-rate systems that nations use to correct imbalances in the balance of payments. The first is a flexible- or floating-exchange-rate system. The second is a fixed-exchange-rate system. If nations use a flexible- or floating-exchange-rate system, the demand for an the supply of foreign currencies determine foreign exchange rates. The exchange rate for any foreign currency is the rate at which the quantity of that currency demanded is equal to the quantity of it supplied. a. A change in the demand for or the supply of a foreign currency will cause a change in the exchange rate for that currency. When there is an increase in the price paid in dollars for a foreign currency, the dollar has depreciated and the foreign currency has appreciated in value. Conversely, when there is a decrease in the price paid in dollars for a foreign currency, the dollar has appreciated and the foreign currency has depreciated in value.
- 15. b. Changes in the demand for or supply of a foreign currency are largely the result of changes in the determinants of exchange rates such as tastes, relative incomes, relative price levels, relative interest rates, expected returns, and speculation. c. Flexible exchange rates can be used to eliminate a balance- of-payments deficit or surplus. (1) When a nation has a payment deficit, foreign exchange rates will increase, thus making foreign goods and services more expensive and decreasing imports. These events will make a nation’s goods and services less expensive for foreigners to buy, thus increasing exports. (2) With a payment surplus, the exchange rates will increase, thus making foreign goods and services less expensive and increasing imports. This situation makes a nation’s goods and services more expensive for foreigners to buy, thus decreasing exports. d. Flexible exchange rates have three disadvantages. (1) Flexible rates can change often so they increase the uncertainties exporters, importers, and investors face when exchanging one nation’s currency for another, thus reducing international trade and international purchase and sale of real and financial assets. (2) This system also changes the terms of trade. A depreciation of the U.S. dollar means that the Untied States must supply more dollars to the foreign exchange market to obtain the same amount of goods and services it previously obtained. Other nations will be able to purchase more U.S. goods or services because their currencies have appreciated relative to the dollar. (3) The changes in the value of imports and exports can change the demand for goods and services in export and import industries, thus creating more instability in industrial production and in implementing macroeconomic policy. 4. If nations use a fixed-exchange-rate system, the nations fix (or peg) a specific exchange rate. To maintain this fixed exchange rate, the governments of these nations must intervene
- 16. in the foreign exchange markets to prevent shortages and surpluses of currencies caused by shifts in demand and supply. a. One way a nation can stabilize foreign exchange rates is though currency interventions. In this case, its government sells its reserves of a foreign currency in exchange for its own currency (or gold) when there is a shortage of the foreign currency. Conversely, a government would buy a foreign currency in exchange for its own currency (or gold) when there is a surplus of the foreign currency. The problem with this policy is that it only works when the currency needs are relatively minor and the intervention is of short duration. If there are persistent deficits, currency reserves may be inadequate for sustaining an intervention, so nations may need to use other means to maintain fixed exchange rates. b. A Nation might adopt trade policies that discourage imports and encourage exports. The problem with such policies is that they decrease the volume of international trade and make it less efficient, so that the economic benefits of free trade are diminished. c. A nation might impose exchange controls so that all foreign currency is controlled by the government, and then rationed to individuals or businesses in the domestic economy who say they need it for international trade purposes. This policy too has several problems because it distorts trade, leads to government favoritism of specific individuals or businesses, restricts consumer choice of goods and services they can buy, and creates a black market in foreign currencies. d. Another way a nation can stabilize foreign exchange rates is to use monetary and fiscal policy to reduce its national output and price level and raise its interest rates relative to those in other nations. These events would lead to a decrease in demand for an increase in the supply of different foreign currencies. But such macroeconomic policies would be harsh because they could lead to recession and deflation, and cause civil unrest. 5. In the past, some type of fixed-exchange-rate system was
- 17. used such as the gold standard or the Bretton Woods system. The exchange-rate system used today is a more flexible one. Under the system of managed floating exchange rates, exchange rates are allowed to float in the long term to correct balance-of- payments deficits and surpluses, but if necessary there can be short-term interventions by government to stabilize and manage currencies so they do not cause severe disruptions in international trade and finance. For example, the G8nations regularly discuss economic issues and evaluate exchange rates, and at times have coordinated currency interventions to strengthen a nation’s currency. This “almost” flexible system is favored by some and criticized by others. a. Its proponents contend that this system has not led to any decrease in world trade, and has enabled the world to adjust to severe economic shocks throughout its history b. Its critics argue that it has resulted in volatile exchange rates that can hurt those developing nations that are dependent on exports, has not reduced balance-of-payments deficits and surpluses, and is a “nonsystem” that a nation may use to achieve its own domestic economic goals. 6. The United States had large and persistent trade deficits in the past decade and they are likely to continue. a. These trade deficits were the result of several factors: (1) More rapid growth in the domestic economy than in the economies of several major trading partners, which caused imports to rise more than exports. (2) The emergence of large trade deficits with China and the use of a relatively fixed exchange rate by the Chinese (3) A rapid rise in the price of oil that must be imported from oil-producing nations (4) A decline in the rate of saving and a capital account surplus, which allowed U.S. citizens to consume more imported goods b. The trade deficits of the United States have had two principal effects (1) They increased current domestic consumption beyond what
- 18. is being produced domestically, which allows the nation to operate outside its production possibilities frontier. This increased current consumption, however, may come at the expense of future consumption. (2) They increased the indebtedness of U.S. citizens to foreigners. A negative implication of these persistent trade deficits is that they will lead to permanent debt and more foreign ownership of domestic assets, or lead to large sacrifices of future domestic consumption. But if the foreign lending increases the U.S. capital stock, then it can contribute to long- term U.S. economic growth. Thus, trade deficits may be a mixed blessing. Chapter Twenty outline 1. A few facts on international trade: a. About 11% of the total output (GDP) of the United States is accounted for by exports of goods and services. While exports and imports account for a larger share of GDP in other nations, the size of the U.S. economy means that it has the largest c combined volume of imports and exports in the world. b. The United States has a trade deficit in goods, a trade surplus in services, and a trade deficit in goods and services. c. The major exports of the United States are chemicals, consumer durables, agricultural products, semi-conductors, and computers. The major imports are petroleum, automobiles, household appliances, computers, and metals. Most of the U.S. trade occurs with other industrially advanced nations and members of OPEC. Canada is the largest trading partner for the United States. 2. The economic basis for trade is based on several circumstances. Specialization and trade among nations is advantageous because the world’s resources are not evenly distributed and efficient production of different commodities
- 19. requires different technologies and combinations of resources. Also, products differ in quality and other attributes, so people might prefer imported to domestic goods in some cases. Some nations have cost advantages in producing labor-intensive goods such as complex electronics that require much skilled work time. Other nations have advantages in producing land-intensive goods such as agricultural products that require abundant natural resources. Still other nations have cost advantages in producing capital-intensive goods such as chemicals or machinery because they have large amounts of physical capital available. 3. The basic argument for free trade among nations is that it leads to a better allocation of resources and a higher standard of living in the world. Several side benefits from trade are that it increases competition and deters monopoly, and offers consumers a wider array of choices. It also links the interests of nations, and can reduce the threat of hostilities or war. 4. Supply and demand analysis of exports and imports can be used to explain how the equilibrium price and quantity for a product (aluminum, for example) are determined when there is trade between two nations (the U.S. and Canada, for example). a. For the U.S., there will be domestic supply and demand as well as export supply and import demand for aluminum. (1) The price and quantity of aluminum are determined by the intersection of the domestic demand and supply curves in a world without trade (all closed economies) (2) In a world with trade (open economies), the export supply curve for the United States shows the amount of aluminum that U.S. producers will export at each world price above the domestic equilibrium price. U.S. exports will increase when the world price rises relative to the domestic price. (3) The import demand curve for the United States shows the amount of aluminum that U.S. citizens will import at each world price below the domestic equilibrium price. U.S. imports will
- 20. increase when world prices fall relative to the domestic price. b. For Canada, there will be a domestic supply and demand as well as export supply and import demand for aluminum. The description of these supply and demand curves is similar to the account of those of the United States previously described. c. The equilibrium world price and equilibrium world levels of exports and imports can be determined with further supply and demand analysis. The export supply curves of the two nations can be plotted on one graph. The import demand curves of both nations can be plotted on the same graph. Equilibrium will be achieved when one nation’s import demand curve intersects another nation’s export supply curve. 5. Nations limit international trade by erecting trade barriers. Tariffs, import quotas, a variety of nontariff barriers, and voluntary export restrictions are the principal barriers to trade. a. The imposition of a tariff on a good imported from abroad has both direct and indirect effects on an economy. (1) The tariff increases the domestic price of the good, reduces its domestic consumption, expands its domestic production, decreases its foreign production, and transfers income from domestic consumers to government. (2) It also reduces the income of foreign producers and the ability of foreign nations to purchases goods and services in the nation imposing the tariff, causes the contraction of relatively efficient industries in that nation, decreases world trade, and lowers the real output of goods and services. b. The imposition of a quota on an imported product has the same direct and indirect effects as a tariff has on that product, with the exception that a tariff generates revenue for government use whereas an import quota transfers that revenue to foreign producers. c. Special-interest groups benefit from protection and persuade their nations to erect trade barriers, but the costs to consumers of this protection exceed the benefits to the economy.
- 21. 6. The arguments for protectionism are many, but often of questionable validity. a. The military self-sufficiency argument can be challenged be cause it is difficult to determine which industry is “vital” to national defense and must be protected; it would be more efficient economically to provide a direct subsidy to military producers rather than impost a tariff b. Using tariff barriers to permit diversification for stability in the economy is not necessary for advanced economies such as the United States, and there may be great economic costs to diversification in developing nations. c. It is alleged that infant industries need protection until they are sufficiently large to compete, but the argument may not apply in developed economies: It is difficult to select which industries will prosper; protectionism tends to persist long after it is needed; and direct subsidies may be more economically efficient. For advanced nations, a variant of this argument is strategic trade policy. It justifies barriers that protect the investment in high risk, growth industries for a nation, but the policies often lead to retaliation and similar policies from other trading nations. d. Sometimes protection is sought against the dumping of foreign goods on U.S. markets at prices either below the cost of production or below the prices commonly charged in the home nation. Dumping is a legitimate concern and is restricted under U.S. trade law, but to use dumping as an excuse for widespread tariff protection is unjustified, and the number of documented cases is few. If foreign companies are more efficient (low-cost) producers, what may appear to be dumping may actually be comparative advantage at work. e. Trade barriers do not necessarily increase domestic employment because: (1) Imports may eliminate some jobs, but create others, so imports may change only the composition of employment, not the overall level of employment. (2) The exports of one nation become the imports of another so
- 22. tariff barriers can be viewed as “beggar thy neighbor” policies (3) Other nations are likely to retaliate against the imposition of trade barriers, and as a result it will reduce domestic output and employment (that is what happened to the United States when it passed the Smoot-Hawley Tariff Act of 1930 that raised tariffs to a very high level); and (4) In the long run, barriers create a less efficient allocation of resources by shielding protected domestic industries from the rigors of competition f. Protection is sometimes sought because of the cheap foreign labor argument that low-cost labor in other nations will undercut the wages of workers in the United States. There are several counterpoints to this argument. First, there are mutual gains from trade between rich and poor nations and they lower the cost of production for products. Second, it should be realized that nations gain from trade based on comparative advantage, and by specializing at what each nation does best, the productivity of workers and thus their wages and living standards rise Third, there is an incorrect focus on labor costs per hour rather than labor cost per unit of production. Labor costs or wages per hour can be higher in one nation than in another because of the higher productivity of workers (and it results in lower labor cost per unit of production) 7. The World Trade Organization (WTO) is an international agency with about 155 participating nations that is responsible for overseeing trade agreements among nations that were established as part of the 1993 Uruguay Round of trade negotiations. The WTO also provides a forum for more trade liberalization negotiations under the Doha Round that was begun in Doha, Qatar, in 2001. These negotiations focus on additional reductions in tariffs and quotas and cutbacks in domestic subsidies for agricultural products. Please post your answer by 11:59PM EDT Thursday July 17th and respond to at least one of your classmates' postings by
- 23. 11:59PM EDT Saturday, July 19th. The Federal Reserve System website, www.federalreserve.gov/releases/H10/hist, provides historical foreign-exchange rate data for a wide variety of currencies. Choose a country, and assume that you were there every New Year’s from January 1, 2003 until this year. You allowed yourself the same budget each year (choose an easy-to-work- with amount, such as 1000 yen, 100 Australian dollars, etc). Convert this amount to U.S. dollars using the posted exchange rate for each January since 2003. Has the dollar appreciated or depreciated against your chosen foreign currency? What was the least amount in dollars that your budget “cost”? The most? Please look at your classmates' posts to see which currencies they've chosen so that you're not all choosing the same ones- the Euro, Pound, Yen, and Australian dollar tend to be chosen by the first few people and I'd prefer that those who post later don't just choose the exact same currencies. Note: When you look at the H.10 report, note that most currencies are reported in foreign currency per USD. However, there are a few that are reported in USD per foreign currency unit: the Australian dollar, the euro, the New Zealand dollar, and the British pound. Be careful!