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Consider Canada's Balance of Payments

Question 9

Multiple Choice

Consider Canada's balance of payments.If the Canadian government were to purchase more foreign-exchange reserves,this transaction


A) represents the sale of an asset,and thus enters as a credit item in the official financing account.
B) represents the purchase of an asset from abroad,and thus enters as a debit item in the capital-service account.
C) enters as a credit in the current account.
D) enters as a debit in the capital account.
E) enters as a credit in the capital account.

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