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Q. Explain the credibility theory of the EMS.
Answer: In this approach the other EMS countries in effect imported the credibility of the German central bank in fighting inflation so discouraging the development of inflationary pressures at home. This is recognized as the credibility theory of the EMS.
Q. Explain why in exchange rate-based stabilization plan may result in a real appreciation? Answer: annotation 8 gives three reasons: first, persistent inflation because of s
Illustration of reciprocal demand through example
explained with example
who looses from tarrif and quota?
conditions for trade unions to claim for higher wages
Importance of International Trades : The basis of international trade is to be found in the diversity of economic resources in different countries. All countries have not been end
Explain why the exchange rate model based on PPP is a long-run theory. Answer: PPP theory is a financial approach to the exchange rate. It is a long-run theory for the reason
Q. Why did the Fed step in to organize a rescue for Long Term Capital Management (LTCM) in September 1998, rather than simply letting the trouble fund fail? Was the Fed's action
Q. "The balance of payments accounts seldom balance in practice." Discuss. Answer: True the major reasons are due to the fact that data received or collected from different so
Q. Use the fixed exchange rate DD - AA model to describe the economy's short-run equilibrium. Then, use the same figure to study an expansionary monetary policy. Show that the pol
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