Question
Domenic was tasked to prepare the balance of payments for Kazi Plc. the details are shown below: Exports 1.1 billion Imports 1.8 billions Export of
Domenic was tasked to prepare the balance of payments for Kazi Plc. the details are shown below:
Exports 1.1 billion
Imports 1.8 billions
Export of services 0.9 billion
Import of services 2.2 billion
Portfolio investments by residents 0.9 billion
Portfolio investments by foreigners 1.3 billion
Foreign direct investments by nonresidents 1.0 billion
Foreign direct investments by residents 0.7 billion
Unilateral payments by resident workers abroad 0.4 billion
Unilateral payments by foreigners working in the country 0.6 billion
Interest and dividends received by residents 0.2 billion
Interest and dividends paid to non- residents 0.5 billion
Loans received by the country 1.1 billion
Grants received by the country 0.7 billion
Required:
- Prepare balance of trade
- Prepare balance of payments.
- Explain the implications of the above statements on the exchange rate of the country
Suggest interventions that can reverse weakening (depreciating) domestic currency.
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