(Answered) The key determinant of net capital outflow is the real

Economics

The key determinant of net capital outflow is the real interest rate. When the U.S. interest rate is high, owning U.S. assets is more attractive, and U.S. net capital outflow is low. This shows this negative relationship between the interest rate and net capital outflow. A net-capital-outflow curve is the link between the market for loanable funds and the market for foreign-currency exchange. Why is this important? You may want to review material in Chapter 19 dealing with the real equilibrium in an open economy.

View complete question

Business Economics, Economics

Category:- Business Economics
Reference No.:- M92356919
Price:- $10

Verified Expert

Priced at $20 Now at $10, Verified Solution

Have any Question?Write your Review or question?

Related Questions in Business Economics

Suppose that the demand curve for tickets to see a football

Suppose that the demand curve for tickets to see a football team play a game is given by Q = 80,000 - 40P and marginal cost is zero. The team's stadium can host 75,000 fans. 1) How many tickets would the team sell if it ...

Suppose for the 3rd year in a row the harvest of wheat in

Suppose for the 3rd year in a row, the harvest of wheat in the US continues to decline. Imports are being used to make up the shortages in the US. In addition the US government decides to establish a price ceiling to hel ...

Elasticity 4 please show your steps and calculation- use

Elasticity: 4% (Please show your steps and calculation- use Arc elasticity) In year one, Mike's income was $56,000 and went to the movies a total of 24 times. The next year, Mike's income increases to $68,000 and he saw ...

You will receive a payment of 10000 per year forever

You will receive a payment of $10,000 per year forever; however the first payment will not begin for 9 years. If the appropriate interest rate is 7%, what is this worth today? Is this 10,000/.07 for 142,857.14? Does it m ...

Use the standard normal distribution or Use the standard normal distribution or

Use the standard normal distribution or the? t-distribution to construct a 90?% confidence interval for the population mean. Justify your decision. If neither distribution can be? used. In a recent? season, the populatio ...

Americans purchase a lot of coffee grown in brazil and

Americans purchase a lot of coffee grown in Brazil and elsewhere in Latin America. It would seem that in order to avoid the huge transportation costs of bringing coffee here and to provide jobs for Americans, we should g ...

Assume 20 of customers who enter a clothing store make a

Assume 20% of customers who enter a clothing store make a purchase and customers behave independently of one another. Ten customers enter the store in the next hour. The salesman on duty makes $20 per hour plus a $10 com ...

A media rental store rented the following number of movie

A media rental store rented the following number of movie titles in each of these catagories: 160 horrors, 242 drama, 114 mystery, 308 romance, and 134 comedy. If a person selects a movie to rent, find the probability th ...

How are prospective payments using drgs intended to change

How are prospective payments using DRGs intended to change the incentive structure for hospitals

Describe two factors contributing to the gender pay gap

Describe two factors contributing to the gender pay gap. Write one equation or one graph for each. What policies could the government pursue to address each factor? Should the government do so?

4,153,160 Questions Asked
13,132 Experts
2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

Recent Questions

Ask Business Economics Expert