Assuming a flexible exchange rate, in the balance model, what effect, other factors constant, will a foreign government budget deficit financed by issuing bonds have on the home country's currency value?
Assuming a flexible exchange rate, in the balance model, what effect, other factors constant, will a foreign government budget deficit financed by issuing bonds have on the home country's currency value?
Principles of Economics 2e
2nd Edition
ISBN:9781947172364
Author:Steven A. Greenlaw; David Shapiro
Publisher:Steven A. Greenlaw; David Shapiro
Chapter23: The International Trade And Capital Flows
Section: Chapter Questions
Problem 10SCQ: Explain the relationship between a current account deficit or surplus and the flow of funds.
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PQ 23
Assuming a flexible exchange rate, in the balance model, what effect, other factors constant, will a foreign government budget deficit financed by issuing bonds have on the home country's currency value?
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