Final answer:
The three scenarios describe changes to the U.S. current account and financial account. A loan for airplane purchases increases both accounts, interest income used to buy a foreign boat increases the current account but worsens the trade deficit, and a bond sale resulting in a U.S. bank deposit boosts the financial account without affecting the current account.
Step-by-step explanation:
To address how changes in the U.S. current account balance and U.S. financial account balance might occur in different scenarios, we'll look at three case studies. Keep in mind that the current account reflects trade in goods and services and income payments, whereas the financial account reflects the net change in ownership of national assets.
In scenario (a), a U.S. bank giving a $60 loan to a Japanese airline, which purchases airplanes from a U.S. firm, will show an increase in exports in the current account due to the airplane sales, and likewise an increase in foreign investment in the financial account due to the loan given to the Japanese airline.
In scenario (b), when a U.S. bondholder receives $10 from Argentina and uses it to buy a boat from New Zealand, there is an inflow of income to the U.S. current account (due to the interest payment) and an increase in the trade deficit (due to the purchase of the boat), which would negatively affect the current account.
Scenario (c) involves a German investor selling bonds to a U.S. investor and depositing the $20 in a U.S. bank. The U.S. financial account would increase due to inward investment reflecting the purchase of foreign bonds. However, this transaction has no immediate impact on the current account as the money is kept in the U.S. and isn't used to purchase goods or services.