Suppose We Measure Canada's Net Capital Outflow by What Statistics

question 54

Essay

Suppose we measure Canada's net capital outflow by what Statistics Canada calls "net international investment position," and we approximate the real exchange rate of the dollar by the price of the Canadian dollar in terms of U.S.dollars.The following table gives some fictitious data on these two variables.
a.What does our open-economy macroeconomic model predict with regard to the relationship between net capital outflow and the real exchange rate?
b.Do you find evidence in the data to support the theory?
c.If you find discrepancies between the data and the theory,what could cause them?

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The power or right to give orders, make decisions, and enforce obedience.

DEA

Short for Drug Enforcement Administration, a United States federal agency responsible for combating drug smuggling and use within the country.

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The authority given to entities to ensure compliance with laws, regulations, or standards.

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Drugs that induce sleep or numbness and have the potential for addiction or abuse, often used for pain relief.