Economics · International Economics
Under the monetary approach to the Balance of Payments (BOP), a currency devaluation leads to a temporary surplus and equilibrium in the balance of payments under the assumption of:
- 1full sterilisation by the central bank
- 2non-sterilisation by the central bank✓
- 3imperfect capital mobility
- 4perfect capital mobility
Correct answer
non-sterilisation by the central bank
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