After a depreciation of the home currency, what is the situation with a nation's external wealth?
A) It will rise if external liabilities exceed external assets.
B) It will fall if external liabilities exceed external assets.
C) It will rise if domestic liabilities exceed domestic assets.
D) It will fall if domestic liabilities exceed domestic assets.
Ans: B) It will fall if external liabilities exceed external assets.
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A factory in a centrally planned economy produces 1,000 left shoes and no right shoes. No corresponding factory produces only right shoes. This outcome is an example of inefficiency in
a. output selection. b. production planning. c. product distribution. d. market segmentation.
The future value of a deposit is:
A. PV * (1 + r) * n, where r = interest rate, n = periods, and PV = present value. B. PV * (1 + r)n, where r = interest rate, n = periods, and PV = present value. C. PV * rn, where r = interest rate, n = periods, and PV = present value. D. PV/(1 + r)n, where r = interest rate, n = periods, and PV = present value.