Major reason behind the drop in international oil prices

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• This case study is an individual work. It is a take-home and open-note assessment
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• The submission will be made on a separate Word document
• The analysis will be made in an essay format requiring a small introduction, body and concluding remarks. There will be no word limit.

Financial markets - Discussion and Analysis:

a. What was the major reason behind the drop in international oil prices? Drawing a supply and demand sketch could be useful.

b. Explain how a weakening yen and low oil prices can help the Japanese economy. Use the aggregate demand and aggregate supply framework to answer this question. No drawing required.

c. "Looming concerns about deflation has prompted the ECB to launch its 60 billion euros a month bond-purchase stimulus' Explain this dtation.

d. How does an appreciation of the dollar (the dollar is becoming mom expensive with respect to other currencies) harm oil imports (and therefore oil demand in many countries)? Explain your reasoning.

e. What is the role of banking regulations in reducing the negative impact of the drop in oil prices on Kuwait's banking sector and economy in general? Briefly discuss the potential negative impacts and then how regulations will help in containing them in Kuwait.

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Reference no: EM131005844

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