How might devaluation affect national domestic investment

Assignment Help Macroeconomics
Reference no: EM13868811

Devaluation is often used by countries to improve their current accounts. Since the current account equals national saving less domestic investment, however, this improvement can occur only if investment falls, saving rises, or both. How might devaluation affect national saving and domestic investment?

Reference no: EM13868811

Questions Cloud

How central banks transactions in foreign exchange market : How are the central bank's transactions in the foreign exchange market re?ected in the balance of payments accounts?
Describe effect of an unexpected devaluation on central bank : Do the exercises in the previous problem for an increase in government spending. Describe the effects of an unexpected devaluation on the central bank's balance sheet and on the balance of payments accounts.
Different arrangements of external weights : Hamstring curls are performed with the two different arrangements of external weights as shown. In the first arrangement in the left image, the weight W is split onto the end of two bars rigidly held at a right angle.
Calculate sky company''s income tax : Sky Company reports a pretax operating loss of $50,000 in Year 3 for both financial reporting and income tax purposes.
How might devaluation affect national domestic investment : Devaluation is often used by countries to improve their current accounts. How might devaluation affect national saving and domestic investment?
Analyze balance of payments effects of an import tariff : Using the DD-AA model, analyze the output and balance of payments effects of an import tariff under ?xed exchange rates.
Paraphrase rather than directly quote citations : Paraphrase rather than directly quote citations
What would happen if the market believed devaluation : Can this ?nancial in?ow be explained using our model? What would happen if the market believed that another devaluation would occur in the near future?
How understanding the historical-cultural context : Please give and explain an example of how understanding the historical-cultural context can shed significant light on the meaning of a specific biblical text

Reviews

Write a Review

Macroeconomics Questions & Answers

  Inflation targeting be a good policy

Why might it be difficult for the Fed to formally adopt inflation targeting?  Would inflation targeting be a good policy for the Fed in the present economic environment

  In using the taylor rule

In using the Taylor Rule as a guideline for monetary policy, what are the pros and cons of using forecasted values of inflation and output rather than observed values of these variables?

  Describe the present economic crisis situation in europe

Describe the present economic crisis situation in Europe.  Why has it been so difficult for the Europeans to find a solution to this problem?   Comment on what implications the crisis may have for the rest of the world if Europeans are not able to ag..

  Long-term federal government budget problems

Question:. Explain why there are long-term Federal government budget problems. Explain why the base-line forecast of the CBO is misleading.

  Derive and compare demand curve

Question based on Derive and compare demand curve,  Derive Ambrose's demand function for peanuts. How does it compare with Johnny's demand curve for peanuts?

  Problem based on utility function

Problem based on  Utility Function - Problem,  Answer and explain the following using a diagram which is completely labeled.

  Laffer curve : tax rate and tax revenue

Question based on Laffer Curve : Tax Rate and Tax Revenue,  Do raising tax rates necessarily raise tax revenue? What factors affect how tax revenue changes when tax rates change?

  Problem - income elasticity of demand

Problem - Income Elasticity of Demand,  Interpret the following Income Elasticities of Demand (YED) values for the following and state if the good is normal or inferior; YED= +0.5 and YED= -2.5

  Positive balance of payment

Question Positive Balance of Payment: "Things will look good for the US if we could just get to where we are consistently running a positive Balance of Payments."

  Effect of recession on the investment curve

Comment on the effect of a recession on the investment curve (only) and on the level of savings, investment, and the equilibrium real interest rate in the financial crisis that hits United States first starting in fall 2007.

  Affect of falling domestic investment on trade surplus and

How will a fall in domestic investment affect the trade surplus and net capital outflows in the domestic economy, the trade deficit and capital inflows in the rest of the world.

  Crises in the banking sector and bank run

Banking crises crisis decreases depositors' confidence in the banking system. What would be the effect of a rumor about a banking crisis on checkable deposits in such a country?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd