--%>

Current and capital account deficit

 Exhibit 3.3 states that in year 1991, the U.S. had current account deficit and consecutively a capital account deficit. Explain about how this may occur?

E

Expert

Verified

In year 1991, U.S. has experienced an overall BOP deficit that should have been accommodated by Federal Reserve’s official reserve action which means decreasing down its reserve holdings.

   Related Questions in Financial Accounting

  • Q : What is Casting What is Casting in

    What is Casting in Accounting. What is its significance?

  • Q : Matlab Applications in Image and Video

    Image and video processing is most difficult topic in electrical and electronics field. This topic becomes trickier if you are taking use of Matlab in this. Student faces a lot of problem in image and video processing theories. If you are messed up with same difficulties

  • Q : Factors considering before investing

    Being an investor, what are all factors you would consider before investing within the emerging stock market of developing country?

  • Q : Discrimination to women and minority

    Most of the organizations have established policies to remedy discrimination whenever hiring women and minorities. Discuss whether you feel that affirmative action programs, reverse discrimination, and criteria of comparable worth are suitable forms of remedy. You mus

  • Q : Advantages and disadvantages of FDI

    State advantages and disadvantages of FDI as opposed to the licensing agreement with the foreign partner?

  • Q : Computing opportunity cost of producing

    Country C is able to generate seven pounds of food or four yards of textiles per unit of input. Calculate the opportunity cost of producing food rather than textiles.  Also, compute the opportunity cost of producing textiles rather than food.

  • Q : Case study of gene expression analysis

    The paper by Golub et al. that was the focus of the second part of the BioConductor practical was the first analysis of its kind, demonstrating that gene expression analysis could potentially be used to classify leukaemia sub-types. Since its publication in 1999 there

  • Q : Maintaining the fixed exchange rate

    Explain why “Once  the capital markets are integrated, it becomes difficult for the country in order to maintain the fixed exchange rate”. 

  • Q : What is Liability Management Liability

    Liability Management: The procedure by which financial institutions balance outstanding liabilities, like deposits, CDs, and so on, with suitable liquidity reserves. Banks and other lenders employ liability management to decrease liquidity risks and u

  • Q : Explain accounting equation in brief..

    what is accounting equation? explain accounting equation and explain its importance?