Multiple Choice
If a country had capital flight, then the real exchange rate would
A) fall. To offset this fall the government could increase the budget deficit.
B) fall. To offset this fall the government could decrease the budget deficit.
C) rise. To offset this rise the government could increase the budget deficit.
D) rise. To offset this rise the government could decrease the budget deficit.
Correct Answer:
Verified
Correct Answer:
Verified
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