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If the United States Receives $200 Billion of Foreign Investment

Question 1

Multiple Choice

If the United States receives $200 billion of foreign investment and at the same time invests a total of $160 billion abroad, then the U.S.


A) capital account balance decreases by $40 billion.
B) official settlements account balance increases by $40 billion.
C) capital account balance increases by $40 billion.
D) balance of payments must be negative.
E) current account must be in surplus.

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