Foreign exchange market, International Economics

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how is exchange rate determined?

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Q. Explain how the AA schedule is derived. Answer: For a fixed real money supply an enhancement in output leads to an increase in the domestic interest rate. In the foreign e

Independent variable, Foreign Direct Investment Theoretical Definition:...

Foreign Direct Investment Theoretical Definition: The causal (independent) variable is the inward Foreign Direct Investment (FDI) to the technology sector. Foreign direct i

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what is delay line in cro?

Discuss differences between absolute ppp and relative ppp, Discuss the diff...

Discuss the differences between Absolute PPP and Relative PPP . Answer:  Absolute Purchasing Power Parity (PPP) states that the exchange rate between two currencies equals the

Composition of production in trade, Q. Using the diagram, show what happen...

Q. Using the diagram, show what happens to the composition of production (that is quantity of cloth per 1 unit of food) in Australia once trade is established between the two coun

Exchange rate-based stabilization plan, Q. Explain why in exchange rate-bas...

Q. Explain why in exchange rate-based stabilization plan may result in a real appreciation? Answer: annotation 8 gives three reasons: first, persistent inflation because of s

What is a convertible currency, Q. What explains the nearly universal scope...

Q. What explains the nearly universal scope of the Great Depression? Answer: The international gold typical played a central role in starting deepening and spreading the Great

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Q. Consider, as a result of several dynamic factors associated with exposure to international competition, Albania's economy grew, and is now shown by the rightmost production pos

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