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Q. What are the main lessons economists learned from the developing country crisis? Answer: 1. select the right exchange rate regime. 2. The central significance of
Q. Discuss the relationship between PPP and the Law of One Price. Answer: The law of one price is applies to individual commodities while Purchasing Power Parity appli
Q. Using the DD - AA framework, show the phenomenon of overshooting. Use a figure to explain when it is taking place. Answer: The figure below illustrates the phenomenon of ov
Q. What do you think about international? Answer: A prescribed procedure whereby a country is able to seek international legal authorization to temporarily stop paying i
Q. Explain the difficulties in naming the new European currency. Answer: Amongst the reasons: Maintenance the name ECU would be misleading the ECU depreciated sharply ag
Q. Analyze the effects of an increase in the European money supply on the dollar/euro exchange rate. Answer: The major points are: A raise in the European money supply will re
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Compare and contrast China's newest economic regions: the Special Economic Zones (SEZs), Open Cities, and Open Coastal Areas. What is the purpose of each regional type? Show how e
economic theories to explain free traden..
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