Under a System of Flexible Exchange Rates, in the Long

Multiple Choice

Under a system of flexible exchange rates, in the long run, a nation's balance on current account and capital account transactions will

A) increase continuously.
B) decrease continuously.
C) tend to net out to zero, indicating a balance between the debits and credits.
D) tend to increase if the nation is running a balance of trade surplus and decrease if it is running a balance of trade deficit.