I. True/ False/ Uncertain - Briey explain. No credit Without an explanation (4 marks each). 1. A BOP

1. rnue/False/Uncertain - Briefly explain. No credit without an explanation (4 marks each). 1. 2. 3. 4. 5. A BOP < O implies a loss of FX reserves. In a closed economy, investment depends on the world interest rate, A drop in oil prices will worsen Canada's current account. In an economy with investment, current account can be in deficit even if savings are positive. An investment surge (i.e. improvements in future productivity) will raise the interest rate in a closed economy.