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Economics

Suppose a US company purchases 1 million Euros’ worth of automobiles from a German car manufacturer, and pays with the proceeds from the sale of Eurobonds. In the same month, a German investor sells $50 million of US Treasury Bills and deposits the proceeds into a US dollar checking account. Calculate the impact (debits and credits) of each of these transactions for the balance of payments and explain exactly where each transaction shows up in the balance of payments accounts.

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Business Economics, Economics

Category:- Business Economics
Reference No.:- M91710652

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