Capital flight is a large-scale exodus of financial assets and capital from a nation due to events such as political or economic instability, currency devaluation or the imposition of capital controls.
Answer-True
Capital flight is most likely to occur when the value of the domestic currency is depreciating...
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Question 44 The market for cars produced in Russia has declined markedly in recent years, mainly due to falling petroleum prices political conflict in Russia • competition from Chinese manufactured vehicles US political pressure on Russia shortage of raw materials Question 46 0/16 When the value of the yen to the dollar goes down, what effect does it have...
27. If the U.S. government takes the value of in-kind transfers into consideration, the U.S. poverty rate decreases. True False 29. The balance of payments is the domestic price of a foreign currency. True False 30. The inequality trap has a negative impact on human capital development. True False 31. According to Rostow's stages of economic development, poor nations must increase their farm productivity so that some workers can leave farming and move into other industries. True False 32. The...
A charge of 2+ is most likely to occur for an ion formed from an atom whose electron configuration is 1s 22s22p635 23p 4. False True
Which of the following will most likely cause a nation's currency to appreciate on the foreign exchange market? O a. A decrease in domestic interest rates O b. An increase in foreign interest rates O c. Stable domestic prices while the nation's trading partners are experiencing 10 percent inflation O d. Domestic inflation of 10 percent while the nation's trading partners are experiencing stable prices
Relatively high cost of capital is more likely to occur in which of the following: Select one: a. Highly liquid domestic capital markets b. None of the mentioned choices c. Highly illiquid domestic capital markets In principle, Multinational firms would have a higher ________ than domestic firms because their cash flows would be more diversified internationally. Select one: a. equity ratios b. none of the choices c. debt ratios
An expansionary gap is most likely to occur when which of these conditions is true? Select one: a. Real GDP is below potential GDP O b. The economy is experiencing a severe recession C. There is a deflation (a fall in prices) in the economy d. The unemployment rate is relatively low e. The economy is not generating any jobs
1. Under a floating exchange rate regime with a high degree of capital mobility, in the short run an expansionary fiscal policy will most likely create pressure on: a. the domestic currency to appreciate. b. the domestic currency to depreciate. c. monetary authorities to revalue the domestic currency. d. monetary authorities to devalue the domestic currency. 2. Under a floating exchange rate regime with a high degree of capital mobility, a change in the exchange rate value of domestic currency...
A country wishing for its currency to fall in value, particularly when confronted with a continual appreciation of its value against major trading partner currencies, the central bank may work to lower real interest rates, reducing the returns to capital. True False
A devaluation of the home currency increases output and makes domestic goods and services cheaper relative to those sold abroad. state whether the statements are TRUE or FALSE and briefly elaborate with a relevant explanation why you believe them to be TRUE or FALSE. (10 marks)
From the U.S standpoint, a capital outflow will occur when a Japanese investor buys a portion of the US government debt. True or false ?