Policies to improve the balance of payments
- Created by: Jess
- Created on: 19-04-14 12:27
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Aim: to raise export revenue and/or reduce import expenditure in order to correct a current account deficit
- Exchange rate adjustment: a central bank may seek to lower the exchange rate by selling its own currency and/or reducing interest rate
A04: demand for exporrts and imports need to be price elastic
may increase inflationary pressure
- Deflationary demand management: to discourage expenditure on…
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