What are the potential effects of a country consistently running large current account deficits? A. It indicates strong economic growth and therefore attracts more foreign investment. B. It may lead to depreciation of the country's currency and increased foreign debt. C. It ensures long-term financial stability and economic prosperity. D. It decreases interest rates and increases domestic consumption.

What are the potential effects of a country consistently running large current account deficits? A. It indicates strong economic growth and therefore attracts more foreign investment. B. It may lead to depreciation of the country's currency and increased foreign debt. C. It ensures long-term financial stability and economic prosperity. D. It decreases interest rates and increases domestic consumption.

MACROECONOMICS

14th Edition

ISBN:9781337794985

Author:Baumol

Publisher:Baumol

Chapter19: The International Monetary System: Order Or Disorder

Section: Chapter Questions

Problem 4DQ

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