Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. finance
  3. in the us, the capital account surplus is roughly

In the US, the capital account surplus is roughly equal to the current account deficit...

80.2K

Verified Solution

Question

Finance

image
In the US, the capital account surplus is roughly equal to the current account deficit in magnitude If the Interest Rate Parity holds, then Covered Interest Arbitrage is possible. A Japanese firm sells TV sets to an American importer for one billion dollars payable in 90 days. To protect against exchange risk, the exporter (Japanese firm) could sell yen on the forward market If the dollar increases in real value, a US firm competing against a US importer firm will be worse off. China buying US T-bills would show up on the capital accounts both countries Hedging transaction risk with forwards and futures can protect against expected changes in exchange rates

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students

Accounting
1.2K views

ALL COMPONENTS / QUESTIONS MUST BE FULLY ANSWERED -- DO NOTUSE THE SIMILAR TEXTBOOK...

General Management
1.2K views

Discuss and identify seven benefits of visual merchandising for the retailer.

Calculus
1.2K views

Differentiate the function G y G y In 4y 1 y 1

Calculus
1.2K views

1 Find the rectangular coordinates of the points that the polar coordinates are given a...

Algebra
1.2K views

1 point A school dance committee is to consist of 2 freshmen 3 sophomores 4...

Algebra
1.2K views

Let p and q represent the following statements p It is Tuesday q I am...

Accounting
1.2K views

PSb 3-3 Calculate Federal Income Tax Withholding Using the Wage-Bracket Method (Pre-2020 Form W-4) For...

Accounting
1.2K views

Direct labor cost budget Provo Racket Company manufactures two types of tennis rackets, the...

Accounting
1.2K views

Sunland Company manufactures a product with a unit variable cost of $100 and a unit...

Accounting
1.2K views

Question 26 of 30> -18,vdots View Policies Current Attempt in Progress Below...

Accounting
1.2K views

(a) On January 1,2024, Ivanhoe Ltd. purchased a piece of equipment for $15,000....

Finance
1.2K views

A 25- year project has a cost of $1,500,000 and has annual cash flows of...