Figure 13.3. U.S. Capital and Financial Account Under a Fixed Exchange Rate System

-Refer to Figure 13.3.As U.S.interest rates rise relative to foreign interest rates,the U.S.slides upward along schedule CA?,thus moving towards capital and financial account surplus.

Question

Figure 13.3. U.S. Capital and Financial Account Under a Fixed Exchange Rate System
 
-Refer to Figure 13.3.As U.S.interest rates rise relative to foreign interest rates,the U.S.slides upward along schedule CA?,thus moving towards capital and financial account surplus.

Quizplus · Accepted Answer

According to Figure 13.3, as U.S. interest rates rise relative to foreign interest rates, the U.S. slides upward along schedule CA, indicating an increase in capital and financial account surplus.

Figure 133