Country Analysis

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Written by:

Mitchell H


Date added:

May 11, 2016








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2 / 511


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Due to the current account surplus of $62.8 billion in the Netherlands, the Dutch government should consider strategies to alter this balance that will help its economy. If inflation starts to increase to a point in which the government feels they need shift their number one macroeconomic objective to price stability at the expense of unemployment, they can use this situation of a high current account surplus to tackle inflation...
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This can occur if the protective barriers on the goods imported into the country, such as tariffs, are decreased. Because of this, more goods will be imported into the Netherlands, which will bring down inflation. The cheaper prices of the imported goods will slightly decrease the prices of goods supplied by domestic producers due to competitive reasons, which will reduce inflation...
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