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Real Exchange Rates (EXCH) is the next variable that will be analysed in this VAR. The reason for including exchange rates in the VAR is that they are an important channel through which the price of oil may impact upon economic activity.Another reason is that the UK exports crude oil worldwide therefore it may be possible to analyse the effects on domestic exchange rates should there be a change in the price of oil. The real exchange rate data uses Jan 2005 = 100 as the base.
Ok... So if the price level is rising, this means that inflation is rising as well, so the value of the dollar in the US would decrease meaning that purchasing power decreases as
Explain what convex indifference curves means in terms of marginal utility. What properties must a utility function have in order to obtain convex indifference curves?
Question 1: Consider a closed economy with no government sector in which consumption (C) is related to income (Y) by the equation: C = A + bY (a) What is the marginal pr
Y= C+I+G C= 100,000000+ 0.4yd I= 400,00000 T= 0.2+60m G= 750, 000000 Calculate equilibrium level of income
what is economic laws ans characteristics of economic laws?
Aggregate Supply in the Short Run Production takes place in business sector on the basis of an expected price for its output. However, costs are incurred in anticipation of sa
If a social entrepreneur is relying on contributions, are there not risks in being accountable and using that money wisely?
Explain the economy automatic stabiliser A budget deficit is shortfall between a government's tax revenue and its spending in a given year. If a government runs a budget defici
explain the functions and role of the world bank
Benefits of Regional Integration Most economic experts cite that regional integration permits disadvantaged countries to realize economies of scale, vie on a broader (often gl
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