Date:
Homework 4
Question 1
The United States account deficit was financed by a capital account surplus which included components such as banking loans, monetary movements, investments and loans.
Question 2
The terms negative international investment position in chapter 12 meant that the nation had become a debtor. That is to imply that the country’s external financial assets and liabilities had a negative value in its statement, which indicates that the United States owed other nations (Krugman 76).
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