Part A Explain the effect of a decrease in capital inflow (from Japan into Aus...
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Part A
Explain the effect of a decrease in capital inflow (from Japan into Australia) on the value of the Australia dollar (relative to the Japanese Yen) in the exchange rate market. The diagram is provided below for reference. (5 marks)
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Part B
Explain the current account and the financial account in Balance of Payments. Explain how capital flows are recorded in the Balance of Payments. (5 Marks)
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