Answered: Explain with an example why the current…

Explain with an example why the current account and financial account balances must exactly offset each other. Provide example with illustration.

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter23: The International Trade And Capital Flows

Section: Chapter Questions

Problem 7SCQ: Why does the trade balance and the current account balance track so closely together over time?

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Why does the trade balance and the current account balance track so closely together over time?
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