What is the Balance of Payment (BOP)? How does BOP and
the balance of trade affect the exchange rate. Discuss the impact
of BOP (pre and post October 2019 crisis) on the Lebanese economy
and exchange rate
1.Explain the difference between a Balance of Payment
(BOP) deficit and surplus?
2. Suppose that a certain country has a current account
surplus. Does this mean that the country will necessarily have a
financial account deficit? Explain why or why not? please
be specific and use your own words.
v) How would the contractionary monetary policy affect the
domestic economy’s trade balance compared to trade deficits
(Expansionary Fiscal Policy)
2) Consider the following representation of a model economy,
C = 4 + 0.7Y
P = 5W
I = 1 − 2i
W/Pe = 0.02Y
Q = 0
Ms = 600
X = 0
L(i, Y ) = P(5Y − 2i)
i) Find the Aggregate Supply equation for this economy.
ii) What is “medium run” full employment output in this...