A Small Open Economy Has a Current Account Balance of Zero.A

question 52

Multiple Choice

A small open economy has a current account balance of zero.A rise in the world real interest rate causes

• A)a current account surplus.
• B)a capital and financial account surplus.
• C)net borrowing from abroad.
• D)absorption to exceed income.

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Definitions:

Unit

In economics, a unit can refer to a single item or product which can be quantified and measured.

Tax Per Unit

A specific charge levied on each unit of a product or service, often used by governments to regulate consumption or raise revenue.

Sellers

Individuals or entities that offer goods or services for sale to consumers or other businesses.

Tax

A compulsory financial charge or some other type of levy imposed upon a taxpayer by a governmental organization in order to fund government spending and various public expenditures.