Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Which one is correct. Can u expalin it in details? A country has a current account balance of -$30bn and a capital and financial account

image text in transcribed

Which one is correct. Can u expalin it in details?

image text in transcribed
A country has a current account balance of -$30bn and a capital and financial account balance (excluding official transactions by the central bank) of +$40bn. Assuming there are no errors and omissions in the balance of payments accounts, the central bank of this country must have purchased $10bn worth of its own currency on the foreign exchange market, and made additions to foreign currency reserves used $ 10bn of foreign exchange reserves to make sales of its own currency on the foreign exchange market used $ 10bn of foreign exchange reserves to make purchases of its own currency on the foreign exchange market sold $10bn worth of its own currency on the foreign exchange market, and made additions to foreign currency reserves

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Contemporary Financial Management

Authors: R. Charles Moyer, James R. McGuigan, Ramesh P. Rao

14th edition

1337090581, 978-1337090582

More Books

Students also viewed these Finance questions

Question

3. Make extra-credit work available to add points to course grades.

Answered: 1 week ago

Question

Discuss the role of electronic media in communication.

Answered: 1 week ago