Which of the following is a reason that developing countries are running large surpluses?
A) They are required to do so by IMF.
B) They have defaulted on international loans.
C) They have pegged exchange rates and thus the growth of exports must drive surplus up.
D) They have a strong desire to accumulate international reserves to protect against a sudden stop of capital inflows.
E) They don't know how to manage their surpluses.
D
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When the Fed supplies the banking system with an extra dollar of reserves, deposits increase by more than one dollar—a process called
A) extra deposit creation. B) multiple deposit creation. C) expansionary deposit creation. D) stimulative deposit creation.
What is the transitional gains trap? In New York, in order to be legal a cab driver must have a medallion (i.e., a license) to operate
With respect to New York cab drivers who, if anyone, received transitional gains? What if the medallion program were ended tomorrow. Who would be harmed?