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Suppose That the Australian Government Acquires More Foreign Currency

Question 7

Multiple Choice

Suppose that the Australian government acquires more foreign currency. How does this change affect the balance of payments accounts?


A) The capital and financial account is negative.
B) The reserve assets account balance is positive.
C) The capital and financial account is positive.
D) The balance of payments accounts sum to a positive number equal to the value of the additional foreign currency the government has obtained.
E) The reserve assets account balance is negative.

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