Tag: balance of payments

current account surplus

A current account surplus happens when a country sells more goods, services, and income to the rest of

A current account deficit happens when a country spends more money on foreign goods, services, and income transfers

Revaluation is the official and deliberate increase in the value of a country’s currency in relation to another

Devaluation is an official decision by a government to lower the value of its currency against other currencies.

The real exchange rate (RER) measures the actual price of goods and services between two countries. It adjusts

The J curve explains how a country’s trade balance changes after its currency loses value (depreciates). It describes

The Marshall-Lerner condition explains that a depreciation of a country’s currency will only improve its current account balance

A protectionist policy refers to government actions taken to shield local businesses from foreign competition by making it

Expenditure-reducing policies are economic strategies used to lower the total amount of money spent within a country. The

Expenditure-switching policies are economic strategies used to move spending away from foreign products toward products made within a