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Q. Explain the issues involved with the Fed acting as a lender of Last Resort (LLR).
Answer: On the one hand LLR make possible the Fed to avoid panic and disturbance to proper functioning of financial markets. On the other hand using the policy may possibly cause problems of moral hazard.
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. 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
Q. Suppose the relative price of good 1 falls relative to the price of. What happens to the wage rate? Answer: The labour component of the price of 1 is bigger than that of p
Application of defferential calculus in economics
what is the diffrent between inter-industry trade and intra industry
Q. Explain why even owners of capital that cannot be moved can avoid more of the economic stability loss due to fixed exchange rates when Norway's economy is open to capital flows
HOW TERMS OF TRADE IS DETERMINED
If one were to use the simple monetary model to predict the $/Euro exchange rate (L is constant), what would the expected exchange rate be?
Q. Explain why large interest rate differences would be strong evidence of unrealized gains from trade. Answer: The difference between offshore and onshore interest rates on
Ask questionQuestion 1: Compute various indicators of the state of the labour market using the following information. Please show all steps of your calculation. If you do not, you
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