Q. Which of the following is true with respect to the monetary approach to the balance of payments?
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(A)
it views the balance of payments as an essentially monetary phenomenon
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(B)
a balance of payments deficit results from an excess demand of money in the nation
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(C)
a balance of payments surplus results from an excess supply of money
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(D)
balance of payments disequilibrium are not automatically corrected in the long run
✅ Correct Answer: (A)
it views the balance of payments as an essentially monetary phenomenon