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Question #49408

If there is a balance of payments deficit then in a floating exchange rate system ?

Options:

A) The external value of the currency would tend to fall

B) The external value of the currency would tend to rise

C) The injections from trade are greater then the withdrawals

D) Aggregate demand is increasing

Answer: If there is a balance of payments deficit then in a floating exchange rate system The external value of the currency would tend to fall.

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