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Suppose Russia’s inflation rate is 200%
Suppose Russia’s inflation rate is 200% over one year, but the inflation rate in Switzerland is only 2%. According to relative PPP, what should happen over the year to the Swiss f...
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what happens when Germany’s current account surplus
Under the price-specie-flow mechanism, what happens when Germany’s current account surplus is greater than its non-reserve financial account deficits?A.German loans will finance a...
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In the short run, a temporary increase in the money supply
A.shifts the AA curve to the right, increases output, and depreciates the currency.B.shifts the AA curve to the left, increases output, and depreciates theC.shifts the AA curve to ...
Which of the following statements is the most accurate?
A.PPP appears to be of limited use as a short-run explanation of exchange rate movements.B.PPP appears to be of limited use even as a short-run explanation of exchange rate movemen...
Consider the following entries into Canada’s
Current Account: 30.7Capital Account: 5.3Financial Account (excluding official international reserves): -24.9 Statistical Discrepancy: -5.5What happened to Canada’s net foreign as...
Which of the following statements is the most accurate?
A.A rise in the interest rate offered by dollar deposits causes the dollar to appreciate.B.A rise in the interest rate offered by dollar deposits causes the dollar to depreciate.C....
Suppose the nation of Pecunia had a current account
What happened to Pecunia’s net foreign assets in 2013?The CA deficit indicated net foreign assets decreased by $1 billion.How would the purchase of Pecunian assets by foreign cent...
The nation of Pecunia had a current account
a.What was the balance of payments of Pecunia in that year? What happened to the country’s net foreign assets?Ans. –The balance of payments is a colloquial name for the official ...
To join the EMU, a country must have a public
To join the EMU, a country must have a public debt below or approaching a reference level ofA.50 percent of itsB.10 percent of itsC.60 percent of itsD.100 percent of itsE.5 percent...
In the short run, with prices fixed,
In the short run, with prices fixed, how would an increase in government spending affect the DD-AA schedule?A.It will increase output and appreciate theB.It will increase output an...








