Which of the Following Is a Reason That Developing Countries

question 104

Multiple Choice

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.

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Definitions:

Paid

Paid denotes a transaction or situation where money is exchanged for goods, services, or completion of a task.

Builders' Liens

Legal claims made by contractors or suppliers against a property they have worked on or supplied materials for, ensuring payment for their services.

Bankruptcy

A legal status for individuals or entities that cannot repay the debts they owe, leading to legal processes to resolve these debts.

Insolvency

Inability of a person to pay her debts as they become due.