Anyone understand what is this question asking?
Using Exhibit 1, which of the following statements is least likely to have an impact regarding reallocation of investments in Reid’s portfolio?
A. Capital account balances are trending and sustainable.
B. Markets are becoming more or less globally integrated.
C. Monetary and fiscal policies are consistent with long-term stability and the phases of the business cycle.
I picked C because it asked which one the options will least likely to have an impact on the reallocation. I was looking for the info in the choices that is consistent with the Exhibit 1. In my mind, if the choice does not provide new info, it will not trigger reallocation.
However, the official answer is as below, which I don’t understand.
“Possible questions suggested for the analyst in the reading explicitly include a reference as to whether current account balances are trending and sustainable. However, it makes no mention of capital account balances as in choice A.
Choices B and C are explicitly referenced in the reading and are referred to in the table.”