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Why we Devising an International Monetary System
Q. Explain the difficulties in naming the new European currency. Answer: Amongst the reasons: Maintenance the name ECU would be misleading the ECU depreciated sharply ag
Q. How mobile is Europe's labor force? Answer: Differences in culture and language discourage labour movements between European countries. Differences in regional unempl
Does the existence of non-tradable goods allow for deviations from Purchasing Power Parity? Answer: Yes the continuation of non-tradable goods permits deviations from Purchas
Q. The migration model of Todaro and Harris provided an important theoretical critique of the manufacturing-biased import-substitution trade-policy stance. Illustrate. Answer:
HOW TERMS OF TRADE IS DETERMINED
Q. In 1986, the price of oil on world markets dropped sharply. Since the United States is an oil-importing country, this was widely regarded as good for the U.S. economy. Yet in
Q. Using the GG - LL framework, analyze the effect of Libya subsidizing the Pakistani Nuclear programs. Answer: This will move the GG curve upward and to the left causi
International Capital Mobility is explained below: The case for the international capital mobility was most evidently articulated by MacDougal in 1960. He presented a framework
Q. Explain how an increase in the real exchange rate affects exports and imports. Answer: While the real exchange rate rises domestic products are cheaper relative to
Q. Explain Tobin's idea of "Don't put all your eggs in one basket." Answer: The idea of diversification advanced with Tobin in his Attitude Towards Risk as well as Por
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