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can cause fluctuations in the exchange rate between its currency and foreign currencies.
a. it will cause inflation b. It will lead to domination of foreign companies in the domestic market
What does direct foreign investments do?
There isn't one..........................................................................................
A balance of payments (BoP) account is an accounting record of all monetary transactions between a country and the rest of the world that include payment for exports and imports of goods, services, financial capital, and financial transfers. The BoP accounts are usual summarize international transactions over one year at a time, prepared in a single currency which is usually the domestic country's currency. Sources of funds for the nation like exports or receipts for loans and investments are recorded as surplus, while uses of funds like for imports or investments in foreign countries are recorded as deficit.
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exportsdirect foreign investments
foreign inflation rates
A surplus in the balance of payments is when a nation has an increase in flow of funds from trade and investments coming in than paying out to other countries. Income from tourism increases the flow of funds into the economy from people of other countries. It results in the flow of foreign currency into the country and is a revenue to the country resulting in a favorable balance of payment.
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I think exports reduces the Balance of payment while foreign capital inflow increases the Balance of payments.
I think exports reduces the Balance of payment while foreign capital inflow increases the Balance of payments.
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