Define fixed exchange rate
Fixed exchange rate: It is the rate of exchange which is fixed by the Government in an economy.
Why foreign currency or exchange is required? Answer: a) To buy services and goods from other countries. b) To send a gift abroad. c) To buy financial assets in a specific country and d) To contem
In simple circular flow model, the only entities which finally consume goods, own resources, pay taxes or bear the loads of inflation, experience joy, or suffer pain, are as: (i) corporations. (ii) Households. (iii) Government agencies. (iv) Business
Balance of payment: It is a systematic record of each and every economic transaction of a country with the rest of world in an accounting year.
Who was responsible for setting the tone for following generations of economists?
Assume that El Salvador can generate coffee at lower opportunity costs than Spain, whereas Spain can generate olive oil at lower opportunity costs than El Salvador. The citizens of both countries can potentially profit from international trade since of the efficiency
5. What are the factors responsible for the recent surge in international portfolio investment?
The practice considers the Treasury’s elucidation of the consequence on macroeconomic adjustment of joining the euro.
Deficit in balance of trade point: Deficit in balance of trade points out that the imports of good are bigger than exports.
Balance of payments (BOP) always balances. Describe it. Answer: Balance of payments is for all time balanced. The negative balance on current account is equated wit
Fixed exchange rate system (or pegged exchange rate system): This is a system in which exchange rate of a currency is fixed by government. This system makes sure stability in the foreign trade and capital movement.
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