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Topic: Business
Number of pages / Number of words: 4 / 889
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This will occur because foreign investors first need to convert their money into Australian dollars before investing in Australia, and if exchanging the money is too expensive they may opt for a nation with a cheaper currency to invest their money into. Value of foreign income earned on investments abroad will mean net income credits would decrease on the current account which is again emphasised on the increasing CAD...


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Value of foreign income earned on investments abroad will mean net income credits would decrease on the current account which is again emphasised on the increasing CAD. Although there is the valuation effect of foreign debt decreasing there is also the valuation effect where the values of foreign assets decrease because as the Australian currency increases our assets compared to foreign currencies are more valuable...


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