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Q. Present the case against floating exchange rates.
Answer:
1.The discipline obligatory on individual countries by a fixed rate would be lost.
2. Undermine speculation and money market disturbances.
3. Damages to investment and international trade.
4. A Clumsy economic policies.
5. The misapprehension of greater autonomy.
Q. Why do we observe the Leontief paradox? Answer: There are several possible answers that they may be categorized into three groups. One would argue that the theory or model
review the general equilibrium conditions under autarky and given free trade using the opportunity cost theory of trade
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What is the significance of the observations made by OECD in this case study regarding “The OECD economies are more strongly dependent on the production, distribution and use of kn
Q. How did the European single currency evolve? Answer: The answer is related to the crumple of Bretton Woods and the European Currency reform of 1969-1978. The Werner
Q. If the central bank does not purchase foreign assets when output increases but instead holds the money stock constant, can it still keep the exchange rate fixed at E 0 ? An
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Q. To answer the following question, please refer to the figure below. Concentrating only at the lower right quadrant, discuss the effects of a change in U.S. expected inflation.
Explanations of FDI and the MNC
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