The Current Account Shows Transactions in Goods and Services; the Capital

question 167

True/False

The current account shows transactions in goods and services; the capital account shows purchases and sales of assets; and the official reserve transactions account shows movement of international reserves.

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Definitions:

Phillips Curve

An economic concept that depicts an inverse relationship between the rate of unemployment and the rate of inflation in an economy.

Price Level Stability

A situation in an economy when overall price levels remain largely constant over time, with minimal inflation or deflation.

Phillips Curve Tradeoff

An economic theory suggesting an inverse relationship between the rate of inflation and the rate of unemployment, indicating that reducing inflation may lead to higher unemployment rates.

Fixed Incomes

Financial investments that provide returns in the form of fixed periodic payments and the eventual return of principal at maturity.