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Q. "It is in the interest of each depositor to withdraw her money from a bank if all other depositors are doing the same, even when the bank's assets are sound." Discuss. As par
Q. Explain why after, say Norway unilaterally pegs the krone to the euro, domestic money market disturbances will no longer affect domestic output despite the continuation of float
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
Q. Explain the following figure: Answer : The figure explicate how the money markets of two countries are linked through the foreign exchange market. The financial pol
Q. Write an essay on the importance of a sound banking system in developing countries. Answer: Students must describe the phenomena of moral hazard as a part of their answer,
Q. Discuss the values of private saving in closed and open economies. Answer: In the closed economy private saving Sp is equal to I + (G - T) and in an open economy private sav
what is net barter terms of trade and the effect on its economy
Q. Using the GG - LL framework, analyze the effect of Libya subsidizing the Pakistani Nuclear programs. Answer: This will move the GG curve upward and to the left causi
Q. "The line distinguishing between external and internal goals can be fuzzy." Discuss. Answer: True For instance employment target for export industries when export growth m
It is argued that a tarriff may help promote employment in a single industry, but is not likely to help employment in general
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