In response to a balance of payments deficit, governments sometimes devalue their currencies to fix the problem.

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In response to a balance of payments deficit, governments sometimes devalue their currencies to fix the problem. According to the J-curve theory, the trade balance worsens immediately after the devaluation but then improves with time. During the ESAP era Zimbabwe did this but the trade balance never improved. Discuss 3 likely reasons for this

Posted Date: Jun 11, 2024 05:09 PM

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In response to a balance of payments deficit, governments sometimes devalue their currencies to fix the problem.

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