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Q. What is the theory of Second Best? Answer: The principal of the second best notify us that when an economy suffers from multiple distortions the removal of only a few
Q. Explain the difference between the following two expressions: Y = C(Y d ) + I + G + CA(EP*/P, Y d ) and Y = C + I +G + CA Answer: The first expression corresponds to a
Q. Even though it is very clear in the context of the Specific Factors model that an expansion of international trade will make losers as well as winners, economists still claim t
heberler''s theory of opportunity cost notes
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
How to calculate effective rate of protection
Does the existence of non-tradable goods allow for deviations from Purchasing Power Parity? Answer: Yes the continuation of non-tradable goods permits deviations from Purchas
Q. How did the European single currency evolve? Answer: The answer is related to the crumple of Bretton Woods and the European Currency reform of 1969-1978. The Werner
Hello, I rent an appartment in Brazil, a country known for its high inflation rates, but I live in Switzerland. Does this mean when I exchange Reais to Swiss Francs (in a +- consta
Q. What is securitization? Answer: The term refers to monetary instruments in which bank assets are repackaged in readily marketable forms These kinds of "derivatives"
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