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Q. What is the interest parity condition?
Answer: The circumstance that the expected returns on deposits of any two currencies are equal when measured in the same currency is called the interest parity condition. It involve that potential holders of foreign currency deposits view them as equally desirable assets that is risk is assumed away. In the notational forms:
R$ = RE + (Ee $/E - E$/E) / E$/E.
Q. What is the domino effect or contagion? Answer: The definition is the defencelessness of even seemingly healthy economies to crisis of confidence generated by events
Using the Heckscher-Ohlin model, discuss how the differences in supply and demand conditions between countries create a basis for trade.
TERMS OF TRADE MEANING AND NET BARTER TERMS OF TRADE MEANING TABLE DIAGRAM
explained with example
Suppose that industry 1 is monopolistically competitive, with a CES sub-utility function: U(c1,c2 ) = c1? + c?2 , 0 We let the marginal costs be denoted by c1(w,r), and the fixe
Q. The U.S. is most probably the most open international market among the industrialized countries. What then does the U.S. have to took by joining the WTO? Answer: There ar
give notes on the alternative theories to trade
what are the aims aond objective and purpose of IMF
Discuss the exceptional supply curve
Q. Present the case against floating exchange rates. Answer: 1.The discipline obligatory on individual countries by a fixed rate would be lost. 2. Undermine specu
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