What will be the immediate effect on the trade balance

Assignment Help Financial Management

Reference no: EM13725512

The table below gives information on foreign trade for a country. a. Using the initial information, what is the country’s trade deficit? b. If the government undertakes policies to depreciate the currency 18%, what will be the immediate effect on the trade balance? c. After the pass-through period (when the quantity has fully adjusted to the new numbers given below and the exchange rates are still at the new rate), what will the trade balance be?

Initial spot rate 2.30

Average export price 17.50

Average import price 12.00

Export quantity 230

Import quantity 190

New export quantity 360

New import quantity 145

Reference no: EM13725512

Questions Cloud

The essay is based on the sinclair novel : The essay is based on the Sinclair novel, The Jungle. The essay should be 4-5 pages in length, double spaced and typed. Your essay will not be accepted if it contains more than five (5) spelling errors.

Questions of true and false : Question 1: The are 6 generations of computer languages Selected Answer: 1- True 2- False Question 2: As discussed in class the computer memory can be divided in RAM and REM Selected Answer: 1- True 2- False

Attractive option for the country and leaders : Research and identify one emerging country and discuss why Marxism might be an attractive option for that country and its leaders. In addition, based on your readings and understanding of Tocqueville, how might he view that country if he were to v..

What is an estimate of barretts price per share : Barrett Industries invests a large sum of money in R&D; as a result, it retains and reinvests all of its earnings. In other words, Barrett does not pay any dividends, and it has no plans to pay dividends in the near future. A major pension fund is in..

What will be the immediate effect on the trade balance : The table below gives information on foreign trade for a country. a. Using the initial information, what is the country’s trade deficit? b. If the government undertakes policies to depreciate the currency 18%, what will be the immediate effect on the..

Who is the composer most strongly associated : Explain the characteristics of this genre and name notable composers. Who is the composer most strongly associated with solo piano music in this era?

Best to prevent workplace violence : Question 1: What kind of policies do you think would work best to prevent workplace violence? Question 2: How could genetic testing be used to discriminate?

The bond pays interest semi-annually : What is the expected market value of a bond that has 5 years to maturity, a yield of 6.5% a coupon rate of 7.5%, a cost basis of 10354.18 and a fair market value of 10,000? The bond pays interest semi-annually.

The prices of both bonds will remain unchanged : You are considering two bonds. Bond A has a 9% annual coupon while Bond B has a 6% annual coupon. Both bonds have a 7% yield to maturity, and the YTM is expected to remain constant. The prices of both bonds will remain unchanged.

User Account

All Pages