Answer to Question #136107 in Macroeconomics for Yolandi

Question #136107

Over a period 2015 – 2019, South Africa experienced an increase in outflow of capital and a decline in capital inflows. The likely impact would be_______
[1] a weaker rand against major foreign currencies and an increase in the demand for net exports.
[2] a decrease in the demand of net exports and a leftward shift of the AD curve.
[3] an increase in interest rates and depreciation of the rand against major foreign currencies.
[4] a stronger rand against major foreign currencies and an increase in the demand for net exports.

Expert's answer

[1] a weaker rand against major foreign currencies and an increase in the demand for net exports.