Could east germany developed without running account deficit

Assignment Help Macroeconomics
Reference no: EM13897891

After running high current account surpluses in the second half of the 1980s, Germany ran sizable deficits in the early 1990s. The most important reason for the current account deficit was the surge in demand from eastern Germany after reunification, causing imports to rise sharply. At the same time, Germany went from being a net creditor country to being a net debtor. Explain why this is a logical implication of the current account deficits. Interest rates in Germany were his torically high during this period. Why might that have been the case? Could East Germany have been developed without running a current account deficit? How?

Reference no: EM13897891

Questions Cloud

Determine seduak''s optimal capital structure : determine Seduak's optimal capital structure
What are the effects on the british balance of payments : What are the effects on the British balance of payments of the following set of transactions? U.K. Videos imports £24 million of movies from the U.S. firm Twenty-First Century Wolf (TFCW).
Determine the required rate of return on the security : Determine the required rate of return on the security
What are the effects on the french balance of payments : What are the effects on the French balance of payments of the following set of transactions? Les Fleurs de France, the French subsidiary of a British company, The Flowers of Britain, has just received.
Could east germany developed without running account deficit : Interest rates in Germany were his torically high during this period. Why might that have been the case? Could East Germany have been developed without running a current account deficit? How?
What is the dividend yield and capital gains yield today : What is the dividend yield and capital gains yield today
What are official international reserves of the central bank : What are official international reserves of the central bank? What is likely to happen if a central bank suddenly prints a large amount of new money?
What are the potential benefits of a pegged currency system : What are the potential benefits of a pegged currency system? What is the difference between a target zone and a crawling peg?
Is the robotic surgery investment financially acceptable : Is the robotic surgery investment financially acceptable

Reviews

Write a Review

 

Macroeconomics Questions & Answers

  Advantages as well as disadvantages of service payment

Compare the advantages as well as disadvantages of fee for service payments and a DRG-based payment system

  What is the optimum demand

The annual fixed cost for an inspecting and profiling web controller manufacturing company is $44,000 and variable cost is $38/unit. If selling price per unit is p = 495 -.05x, what is the company’s range of profitability demand? What is the optimum ..

  What is mbank profit when it charges

Mbank has deposit liabilities of $100 million. It only keeps the minimum cash reserves required by law of 10%. Its annual costs (wages, rent, utilities, etc.) are $2.5 million. What is Mbank's profit when it charges 7% annual interest on its loans, a..

  Analysis of price elasticity and price increase

In an article about the financial problems of the USA today, Newsweek reported that the paper was losing about $20 million a year.

  Draw what would happen to equilibrium if both supply

Draw what would happen to equilibrium if both supply and demand shifted to the right at the same.What happens to equilibrium quantity and price?

  Suppose that charles home improvement when disposal cost

Now suppose that Charles Home improvement, when the disposal cost of old water heaters is included, has exactly the same average and marginal cost curves for installing replacement water heaters as does ABC water heater.

  Compute the equilibrium price and quantity

Assume you are given the following information about a particular industry, Determine the equilibrium price, the equilibrium quantity, output supplied by the firm, and the profit of each firm.

  Multiple choice questions based on competitive market

A perfectly competitive market company realizes an average of $11 and an average total cost of $10.00. Marginal cost curve crosses marginal revenue curve at an output level of 100 units.

  Explain the science of economics in the presence

Explain the science of economics in the presence of making a profit with scarce resources

  Average fixed cost is 5 then what is my total variable cost

If my Unit of Ouput is 4, my Total Fixed Cost is 20, my Average Total Cost is 12, and my Average Fixed Cost is 5 then what is my Total Variable Cost for this problem?

  How does the market guide the decisions

Consider a farm in the former Soviet Union. Try to describe how dicisions on the number of chickens to be raised, and the amount of each feed to use in raising them, were made under the old communist regime.

  Determine the market equilibrium price

There is a vast number of hog farmers in Canada. Industry should be a good approximation to perfectly competitive market. The demand for processed pork in Canada is;

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd