Under flexible exchange rates, what happens if a country experiences a deficit in its balance of payments?

Question:

Under flexible exchange rates, what happens if a country experiences a deficit in its balance of payments? How long can a deficit in the balance of payments persist?

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For book-img-for-question

Financial System Of The Economy Principles Of Money And Banking

ISBN: 9780765622464

5th Edition

Authors: Maureen Burton,Bruce Brown

See More Books

Question Posted: Nov 28, 2023 11:59 PM

See More Questions

Gold has served as a medium of exchange and a store of value. The increase in trade led each country to set a par value for its currency in terms of gold. The gold standard as an international...
When a country ran a deficit in its balance of payments under the Bretton Woods Accord, how was that deficit resolved?
What does a deficit in a countrys balance of trade imply? Can a country have a surplus in its balance of payments?
A paper recycling company converts newspaper, mixed paper, white office paper, and cardboard into pulp for newsprint, packaging paper, and print stock quality paper. The following table summarizes...
The following account balances are taken from the general ledger of Whitni Corporation on December 31, 2011, the end of its fiscal year. The corporation was organized January 2, 2005. Cash . . . . ....
Ambient air at 100 kPa and 300 K is compressed isentropically in a steady-flow device to 0.8 MPa. Determine (a) The work input to the compressor, (b) The exergy of the air at the compressor exit, and...
Explain, with the help of neatly drawn formats, the various types of subsidiary books.
An Evaluation of the Dilemma at Benevento Foods: Understanding Cause and Effect and Recommendations for Improvement For this Assignment, you will continue to evaluate the same scenario from the...
The Taylors are saving up to go on a family vacation in 2 years. They invest $2500 into an account with an annual interest rate of 1.18% compounded quarterly. A. Assuming no withdrawals are made, how...
Why and how do central banks intervene in foreign exchange markets under the managed float exchange rate system?
Leticia is a small country that is experiencing a deficit in its balance of payments. The value of Leticias currency is tied to the U.S. dollar, which has been appreciating. What options could the...
A 37.5% trade discount on a camera represents a discount of $223.14 from the suggested retail price. What is the net price to the buyer?
2. (40 marks) Solve for y(t) such that y" - 6y' + 15y = 2 sin(3t),
6. Determine output class A{ ); } public static void main(String args[]) { int x; x = 10; if (x == 10) { int y = 20; System.out.print ("x and y: y = x*2; + y); } y = 100; } System.out.print ("x and...
Anita and Bonita have been roommates for the past two years while they've been in graduate school. Now that they're graduating, they are each planning to move to different cities. Their one joint...
To what extent are business ethics assumed, or taken for granted, by people in businesses?
Empowered by what he has learned in this class about gender, Brady makes a friendly wager with his girfriend, Marlisa: "I bet I can guess how the men and women at the next table will behave during...
Match each description with a white blood cell in the key. Key: a. lymphocytes b. Neutrophils c. Basophils d. Monocytes E. Eosinophils U-shaped nucleus; blue-stained granules that release histamine?
The sales department of P. Gillen Manufacturing Company has forecast sales in March to be 20,000 units. Additional information follows: Finished goods inventory, March 1 . . . . . . . . . . . . . . ....
Define the formal and personal bases of power.
List and define nine influence tactics.
Describe the effective use of influence tactics.
Nitin is paid a base salary of $200 per week and commission at the rate of 3% for sales over $5000, 4% if his sales are over $8000, and 5% if sales are over $15,000. How much will Nitin earn in a...
Safa is paid a base salary of $1500 per month and a commission of 6% on all sales over $75,000. Last month, Safa's gross salary was $4440. What were her sales for the month? a$149,000 b$124,000...
Your regular hourly rate of pay is $15.86, and you are paid double time for all work on weekends and for any time over forty hours per week (Monday to Friday). Calculate your gross earnings for a...

Under flexible exchange rates, what happens if a country experiences a deficit in its balance of payments?

Question:

Step by Step Answer:

Under flexible exchange rates a deficit in the balance of payments occurs when a countrys imports exceed its exports leading to a net outflow of forei...View the full answer

Financial System Of The Economy Principles Of Money And Banking

Students also viewed these Business questions