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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.
Opportunity cost theory
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critically evaluate Adam Smith''s theory of absolute advantage,outlining the assumptions necessary for the theory to hold in its purest form.what are the criticisms of this theory
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Why would interest rate parity hold better than Purchasing power parity overtime?
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