Question
13.1 : Say someone from Germany travels to France to buy a 100 euro case of wine. The French company that sells the wine deposits
13.1: Say someone from Germany travels to France to buy a 100 euro case of wine. The French company that sells the wine deposits the 100 euro check in its account in a German bank. How would these transactions show up in the balance of payments account of France and Germany.
13.2: Can you think of reasons why a government might be concerned about a large current account deficit or surplus? Why might it be concerned about its balance of payments (official settlements balance). (you can be brief, don't a long essay)
13.3: Is it possible for a country to have a current account deficit at the same time it has a surplus in its balance of payments. Please give an example (using made up numbers)
13.4: Please explain how a country could have a current account deficit and a positive movement in its Net Foreign Asset position.
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