A _____________ is a large capital outflow which if successful can cause __________ .
A) balance of payments surplus, inflation
B) speculative attack, devaluation
C) speculative attack, revaluation
D) balance of payments surplus, unemployment

Question

Quizplus · Accepted Answer

A speculative attack is a massive selling of a country's currency, which can lead to its devaluation if the attack is successful. This is because the supply of the currency increases significantly, potentially exceeding demand and thus lowering its value.

A _____________ Is a Large Capital Outflow Which If Successful