contestada

An increase in the current account deficit will place ____ pressure on the home currency value, other things equal.
a. upward.
b. no.
c. upward or downward (depending on the size of the deficit).
d. downward.

Respuesta :

Tundexi

When there is an increase in the current account deficit, this will place downward pressure on the home currency value and other things equal.

What is a deficit in current account?

A deficit in current account happens when total value of goods and services a country imported exceeds the total value of goods and services exported.

Hence, in that situation where there is an increase in the current account deficit, this will place downward pressure on the home currency value and other things equal.

Therefore, the Option D is correct.

Read more about current account

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