Which of the Following Would Cause the Current Account to Decrease

question 36

Multiple Choice

Which of the following would cause the current account to decrease?

• A)an increase in the nominal exchange rate,E
• B)an appreciation of the home currency
• C)an increase in disposable income
• D)an increase in foreign prices,P
• E)a decrease in domestic prices,P

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Definitions:

Sales Tax

A tax levied by a government on the sale of goods and services, collected by the retailer at the point of sale and passed on to the government.

Merchandise

Goods that are purchased for resale at a profit.

Asset Account

An account that records all financial transactions related to a company's assets, including current and fixed assets.

Credit Customer

A customer who purchases goods or services on credit, paying for them at a later date.