When Mexico suffered from capital flight in 1994,Mexico's net exports
A)decreased.
B)did not change.
C)increased.
D)decreased until the peso appreciated,then increased.

Question

Quizplus · Accepted Answer

Capital flight typically leads to a depreciation of the local currency, in this case, the peso. A weaker peso makes Mexican goods cheaper for foreign buyers, thus increasing net exports.

When Mexico Suffered from Capital Flight in 1994,Mexico's Net Exports