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Q. Explain what a "vehicle currency" is. Why is the U.S. dollar considered a vehicle currency?
Answer: A vehicle currency is one specifically widely used to denominate international contracts made by parties who don't reside in the country that issues the vehicle currency. While 2001 ninety percent of foreign exchange transactions engross exchanges of foreign currencies for U.S. dollars so the dollar is considered a vehicle currency.
what is meant by country specific advantage?
Q. Other things being equal, a rise in a country's terms of trade enhances its welfare. What could happen if we relax the ceteris paribus assumption, and allow for the law of dema
Explanations of FDI and the MNC
WHAT ARE THE ROLES OF FOREIGN TRADE IN ECONOMIC DEVELOPMENT
what is opportunity cost thory explain it with example
Q. Illustrate why when Norway unilaterally fixes its exchange rate against the euro but leaves the krone free to float against the non-euro currencies, it is unable to keep at leas
Opportunity cost theory
An International Regime for FDI and MNCs
review the general equilibrium conditions under autarky and given free trade using the opportunity cost theory of trade
Q. Even though it is very clear in the context of the Specific Factors model that an expansion of international trade will make losers as well as winners, economists still claim t
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