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If Foreign Investors Believe That the Hungarian Government Will Default

Question 67

Multiple Choice

If foreign investors believe that the Hungarian government will default on their debt,which of the following might happen?


A) a decrease in Hungarian interest rates and an increase in Hungarian net capital outflow
B) an increase in both Hungarian interest rates and net capital outflow
C) a decrease in both Hungarian interest rates and net capital outflow
D) an increase in Hungarian interest rates and a decrease in Hungarian net capital outflow

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