The J-Curve Effect Implies That in the Short Run a Currency

question 71

True/False

The J-curve effect implies that in the short run a currency depreciation will result in a balance of trade surplus for the home country.As time passes, however, the home country's balance of trade will move toward deficit.

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Definitions:

Explicit Memory

The type of long-term memory that involves conscious recollection of previous experiences or information.

Implicit Memory

A type of memory that enables us to perform tasks without conscious awareness of these previous experiences.

Bottom-Up

A processing approach where the system builds up information from the smallest, most basic elements to construct the bigger picture.

Top-Down

Top-down refers to cognitive processes guided by higher-level mental processes, as when we construct perceptions drawing from our experience and expectations.