Refer to following table, in which Qd is the quantity of yen demanded, P is the...

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Economics

Refer to following table, in which Q_d is thequantity of yen demanded, P is the dollar price of yen,Q_s is the quantity of yen supplied in year 1,and Q_s' is the quantity of yen supplied in year2. All quantities are in billions.
Q_d P Q_s Q_s'
20 130 40 60
30 125 30 50
40 120 20 40
50 115 10 30
Assume that the exchange rate is fixed against the dollar at theequilibrium exchange rate that occurs in year 1. Also suppose thatJapan and the Canada are the only two countries in the world.
In year 2, what quantity of yen would the Japanese governmenthave to buy or sell to balance its capital and financial accountwith its current account?
Buy OR Sell ____bollion Yen?
In what specific account would this purchase or sale show up inJapanâ€™s balance of payments statement?
Foreign purchases of assets in Japan OR Japanese purchase ofassets abroad
Would this transaction increase Japanâ€™s stock of officialinternational reserves or decrease its stock?
Decrease OR Increase

Answer & Explanation Solved by verified expert

3.7 Ratings (622 Votes)

Bn Bn Bn Bn Qd P Qs Qs 20 130 40 60 30 125 30 50 40 120 20 40 50 115 10 30 1 65 Qd Yen Demand P Price of Dollar in Yen Qs Quantity of Yen supplied in Yr 1 Qs See Answer

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