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Q. What is the purpose of the following figure? Answer: The use of the figure is to show the inflation convergence within the six original EMS members. The f
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Q. Contrast the crisis in Poland and Russia. Explain why the Polish economy has done better? Answer: With the end of the 1990s a handful of East European economies including
part of the return on the investment comes from the asset itself and part from the currency of the foreign currency. agree or disagree?
Criticism against Hechscher-Ohlin type trade theories is explained below: The foremost criticism leveled against Hechscher-Ohlin type trade theories are that they views compara
Q. Explain why Relative PPP is useful when comparing countries that base their price levels on different product baskets. Answer: For instance If the U.S price level increase
Explain the complexities in the annalysis of balance of payment equilibrium
Analyze the effects of an increase in the European money supply on the dollar/euro exchange rate. Answer: The major points are: A raise in the European money supply will reduc
Q. How much trade do currency unions create? Answer: The major result is that currency unions promote trade. One study originate that on average two countries that are
Q. What is the policy of sterilization? Give an example. Answer: • Untainted foreign exchange intervention - policy by which central banks perform equal foreign
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