Current account transactions are payments that are related to the purchase or sale of

If the price elasticity of demand for a good is 0.8, then a

A) 1 percent rise in the price leads to a 0.8 percent decrease in the quantity demanded. B) one dollar rise in the price leads to a 0.8 percent decrease in the quantity demanded. C) 1 percent rise in the price leads to an 80 percent decrease in the quantity demanded. D) 1 percent rise in the price leads to an 8 percent decrease in the quantity demanded.

When the value of one currency increases relative to the value of another currency, it has experienced:

A. exchange rate appreciation. B. interest rate depreciation. C. net capital inflow. D. exchange rate depreciation.