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Explain why the exchange rate model based on PPP is a long-run theory. Answer: PPP theory is a financial approach to the exchange rate. It is a long-run theory for the reason
In the Ricardian analysis, why does each trading partner have an incentive to produce at an endpoint of its production-possibility frontier? Why are prices of factors of production
critically examine the effects of tariffs on the level of employment and income distribution.
Q. Explain the credibility theory of the EMS. Answer: In this approach the other EMS countries in effect imported the credibility of the German central bank in fightin
Q. What is an SDR? Answer: An SDR abbreviation of Special Drawing Right at the IMF and holds a place as a world reserve currency some countries especially those that do
Q. Explain Purchasing Power Parity. Answer: PPP () states that the exchange rate between two countries' currencies equals the ratio of the countries' price levels.
Detail about offer Curves
Q. What are the main points of economic life that macroeconomics analysis is most concerned with? Answer: There are four major aspects that are saving, unemployment, trade imb
To answer the following question, please refer to the figure below.Concentrating only at the lower left quadrant, discuss the relationship between the U.S. real money supply and th
Q. Explain why, according to Feldstein and Horioka, one should expect that domestic investment rates diverge widely from saving rates. Answer: The decisions of corporations t
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