Which of the following factors potentially increased the vulnerability to the 1997 Asian financial and currency crisis ?
Correct answer: B. massive reverse outflows of capital
- A. trade account surplus
- B. massive reverse outflows of capital
- C. technological transfer from DCs
- D. Symmetric informational in financial market
Explanation
A sudden reversal of capital flows can drain foreign exchange reserves, weaken currencies and expose banks and firms with foreign-currency liabilities, greatly increasing crisis vulnerability. A trade surplus and technology transfer would normally provide some protection rather than create this specific risk.
Report an error
The more specific you are, the faster it gets fixed. A source beats an opinion.
Prefer email? [email protected]
About Macroeconomics
The economy is studied as a whole through national income, gross domestic product, inflation, unemployment, economic growth and business cycles. Coverage includes aggregate demand and supply, consumption and investment, money and banking, fiscal and monetary policy, exchange rates and balance of payments, which distinguishes macroeconomics from the study of individual markets.
Practise Macroeconomics
1,499 free Macroeconomics MCQs from Economics, each with the correct answer and an explanation. Unlimited attempts, no account needed.
Discussion
Stuck on an option, or know a faster way to get there? Ask or explain it here.
No comments yet. Be the first to explain this one.
Exams that ask Economics questions like this
Economics is on 3 papers prepared for on TestUstad, and all of them draw the same bank, so this question is worth knowing for every one of them.
More Macroeconomics questions
Shortly after 1979 World Bank introduced loans that emphasized reforms in trade, agriculture industry public enterprise financial energy education or other sectors and were know as ?
Fundamentalists want the IMF to lend to crisis-stricken countries on condition that they undertake fundamental structural reforms in banking Joseph Stiglitz however thinks it is______________?
Mosley Harrigan and Toye refer to the IMF and World Bank as________________?
Net transfers are______________?
Which of the following country did Not suffer from increased poverty from debt and financial crises in the 1990s ?
Which of the following country did not experience large capital flights from 1976 to 1984 ?