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Q. What are the main functions of money?
Answer: Money serves generally three important functions that are a unit of account, a medium of exchange and a store of value.
As medium of exchange money evade going back to a barter economy with the enormous search costs connected with it. Like a unit of account the use of money economizes on the number of prices an individual faces. Consider a financial system with N goods then one need only (N- 1) prices. Like a store of value the use of money in general ensures that you can transfer wealth between periods.
Q. Consider how the United States' balance of payments accounts are affected when U.S. banks give two billion in debt owed to them by the government of Argentina. Answer: In
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Q. Explain the Law of One Price. Give an example. Answer: The law of one price affirms that in competitive markets free of transportation costs and trade barriers ide
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What does SRC stand for?
Question 1: The main challenge facing governments in the 21st century revolves around containing and/or downsizing of public spending. Explain why reduced government interventi
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