Exchange rate between the dollar and the euro, International Economics

Assignment Help:

Q. What is the real exchange rate between the dollar and the euro equal to?

Answer: Let actual dollar/euro exchange rate q$/ENominal exchange rate E$/EPrice of an unchanging basket in US PUS Price of an unchanging basket in Europe PE Then q$/E = E$/E PE / PUS. A boost in the real dollar/euro exchange rate is called as a real depreciation of the dollar beside the euro a decrease in purchasing power of the dollar.

A diminish in the real dollar/euro exchange rate is called as a real appreciation of the dollar beside the euro a increase in purchasing power of the dollar.


Related Discussions:- Exchange rate between the dollar and the euro

Growth affect albanias terms of trade, Q. Consider, as a result of several...

Q. Consider, as a result of several dynamic factors associated with exposure to international competition, Albania's economy grew, and is now shown by the rightmost production pos

What economic forces made french goods, Q. In the year 2000, Americans flo...

Q. In the year 2000, Americans flocked to Paris. What economic forces made French goods seem so cheap to residents of the United States? Answer: One main factor was a sharp f

Sovereign wealth funds on gdp, In as much as Sovereign Wealth Funds (SWFs) ...

In as much as Sovereign Wealth Funds (SWFs) are established to achieve national objectives, the intentions of the United Arab Emirates -- one of the world's largest -- are open to

International trade commission proceedings, Q. It can be demonstrated that...

Q. It can be demonstrated that any protectionist policy, which effectively shifts real resources to import competing sector or industry, will harm export industries or sectors. T

Tariffs, critically examine the effects of tariffs on the level of employme...

critically examine the effects of tariffs on the level of employment and income distribution.

Substantial current account deficit, Q. What are the reasons for the world ...

Q. What are the reasons for the world as a whole running a substantial current account deficit? Answer: This deficit improved sharply in the early 1980s and has remained high.

Change in money supply creates immediate demand and cost, "Although the pri...

"Although the price levels appear to display short-run stickiness in many countries, a change in the money supply creates immediate demand and cost pressures that eventually lead t

Why is the u.s. dollar considered a vehicle currency, Q. Explain what a "v...

Q. Explain what a "vehicle currency" is. Why is the U.S. dollar considered a vehicle currency? Answer: A vehicle currency is one specifically widely used to denominate inter

Discuss the hechscher-ohlin model, Q. Countries that are willing to toler...

Q. Countries that are willing to tolerate an unusually high quantity of pollution relative to their supplies of other factors would leads to export "pollution-intensive" goods. D

Write Your Message!

Captcha
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