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Article Summary In an Effort to Decrease an Outflow of Capital Which

question 198

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Article Summary
In an effort to decrease an outflow of capital which has threatened to extend the country's economic slowdown,China's central bank sold $94 billion U.S.dollars in an attempt to support its currency,the yuan.The move followed the largest devaluation of the yuan in more than 20 years.According to analyst Li Miaoxian,"If the central bank continues its intervention,China's foreign-exchange reserves will continue to shrink -- the heavier the intervention,the deeper the fall.It's "inevitable" the nation will see continuous capital outflows and yuan depreciation pressure in the coming months.Over the past decade,the Chinese central bank had purchased dollars in an effort to stem the appreciation of the yuan during a period of a growing trade surplus.Now facing an increasing sell-off of the yuan,Bloomberg economists note that "The fear is that today's data will reinforce the market view that the only way for the yuan to go is down,and further accelerate capital outflows."
-Refer to the Article Summary.All else equal,a depreciation of the Chinese yuan relative to a currency such as the U.S.dollar should ________ Chinese exports and ________ imports to China.

Definitions:

Imprisonment

The act of confining someone in a prison or similar facility as a form of punishment for committing a crime.

Affirmative Disclosure

The requirement to voluntarily provide all relevant information that could influence a decision or consent, especially in agreements or transactions.

Deceptive Advertising

Marketing practices that mislead or deceive consumers into believing something false or not providing the full truth about a product or service.

FTC

Stands for Federal Trade Commission, an independent agency of the United States government aimed at promoting consumer protection and the elimination and prevention of anticompetitive business practices.