The following figure shows the Current Account Balance (similar to the Trade Balance) of Japan (black line) and China (red line). During their growth periods (1980s for Japan and 2000s for China), were these countries net savers or borrowers? What are some ways that the governments intervened in the foreign exchange market to keep their BOP from adjusting towards 0? 12.5 10.0 7.5 5.0 2.5 0.0 2.5 -5.0 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 US $, Sum Over Component Sub-periods/10000000000
The following figure shows the Current Account Balance (similar to the Trade Balance) of Japan (black line) and China (red line). During their growth periods (1980s for Japan and 2000s for China), were these countries net savers or borrowers? What are some ways that the governments intervened in the foreign exchange market to keep their BOP from adjusting towards 0? 12.5 10.0 7.5 5.0 2.5 0.0 2.5 -5.0 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 US $, Sum Over Component Sub-periods/10000000000
Macroeconomics: Private and Public Choice (MindTap Course List)
16th Edition
ISBN:9781305506756
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Chapter19: International Finance And The Foreign Exchange Market
Section: Chapter Questions
Problem 9CQ
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Transcribed Image Text:The following figure shows the Current Account Balance (similar to the Trade Balance) of Japan
(black line) and China (red line). During their growth periods (1980s for Japan and 2000s for
China), were these countries net savers or borrowers? What are some ways that the
governments intervened in the foreign exchange market to keep their BOP from adjusting
towards 0?
12.5
10.0
7.5
5.0
2.5
0.0
-5.0
1986
1988
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
2012
Source: Organization for Economic Co-operation and Development
fred.stlouisfed.org
US $, Sum Over Component Sub-periods/10000000O000
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