How is the exchange rate influenced by inflation
‘The country has a floating exchange rate and its inflation rate is much higher than its trading partners. Why we would suppose the country’s exchange rate to deflate?’
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Because of the consequence on demand and supply of currency and the new equilibrium. It distinguishes among real and nominal values.
what are the key callenges to indian economic development
State the items that are not involved in the current account of India’s Balance of payment. Answer: The capital transactions is in the form of direct and portf
‘Can foreign exchange markets be analyzed in similar manner as the markets for ordinary physical commodities? Do demand slope downwards and supply slope upwards for currencies?’
China is a huge manufacturer of technology of telephone devices. It has lately become a member of W.T.O. that means it can sell its products in other member countries such as India. Assume that it does export a big number of telephone instruments to India:
Let us suppose that US gasoline market has the demand and supply curvesQd = 10 – 0.5PdQs = -2 + Ps when Ps ≥ 2 and Qs = 0 if Ps < 2, Q : Accounts in Balance of Payments or BOP Name the accounts in the balance of payments (BOP)? Answer: a. Current account: It exhibits the imports and exports of services and goods and transfer payments.b. Capital Account: It exhibits the assets and li
Name the accounts in the balance of payments (BOP)? Answer: a. Current account: It exhibits the imports and exports of services and goods and transfer payments.b. Capital Account: It exhibits the assets and li
State the two sources of demand of foreign exchange: Import of services and goods and to acquire education in abroad.
Foreign exchange rate: The Foreign exchange rate is a price of foreign currency in terms of domestic currency.
Fixed exchange rate: It is the rate of exchange which is fixed by the Government in an economy.
In a completely employed economy, the higher the yield of capital goods, and the bigger its: (1) Present living standards. (2) Present output of consumer goods. (3) Growth of capacity for the future production. (4) Rates of inflation and unemployment.
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