Which of the following statements is true?
(a) A country runs a current account deficit if it exports more goods and services than it imports;
(b) The sum of the current and capital accounts must be zero;
(c) If both the current and capital accounts are in surplus, the exchange rate must appreciate;
(d) None of the above are true.
Answer: (d) None ofthe above are true.
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Marginal utility
A) characterizes things of little use. B) is the additional utility derived from the last unit of a good consumed. C) is an implication of the law of demand. D) is always negative when total utility is positive and positive when total utility is negative.
If a firm has market power in the output market but buys labor in a competitive market, it will hire the same quantity of labor that a competitive firm will
Indicate whether the statement is true or false
Consider borrowers and lenders who agree to loans with fixed nominal interest rates. If inflation is higher than what the borrowers and lenders expected, then who benefits from lower real interest rates?
a. Only the borrowers benefit. b. Only the lenders benefit. c. Both borrowers and lenders benefit. d. Neither borrowers nor lenders.
If net exports are positive, then
a. exports are greater than imports. b. net capital outflow is negative. c. Both of the above are correct. d. Neither of the above is correct.