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Q. How did the international monetary system influence macroeconomic policy-making and performance during the gold standard era (1870 - 1914)?
Answer: London was the hub of the international monetary system. The most important responsibility of the central bank was to preserve the official parity between its currency and gold. To sustain this price the central bank desirable an adequate stock of gold reserves. Central banks try to avoid sharp fluctuations in the balance of payments.
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Q. Analyze the effects of devaluation on an economy. Answer: Devaluation basis a rise in output a rise in official reserves and an expansion of the money supply. A private cap
According to the Linder theory, trade will occur in goods that have overlapping demand. With aid of a graph, illustrate this theory and its implications. Make use of graph
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 unchan
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Q. Discuss the effects of the reunification of eastern and western Germany in 1990 on both Germany and its neighboring European countries. Answer: Germany rumbles high interest
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