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Based on the Balance of Payments forecasts for (foreign) Country 1 and Country 2, 2020 2021 2022 2023 -10 -12 -11 -12 0 0 0
Based on the Balance of Payments forecasts for (foreign) Country 1 and Country 2, 2020 2021 2022 2023 -10 -12 -11 -12 0 0 0 0 2 5 9 12 $Billion Country 1 Current Account Capital Account Financial Account excl Reserves Reserves Country 2 Current Account Capital Account Financial Account excl Reserves Reserves 8 7 2 0 -20 -24 -22 -24 0 0 0 0 16 14 4 0 4 10 18 24 which investment strategy is most likely to provide the highest return on investment in home currency? a. A portfolio of stock in companies from Country 1 b. A portfolio of stock in companies from Country 2 C. Neither country is likely to provide a higher return on investment than the other d. Country 1 stocks should be shorted and Country 2 stocks should be longed
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