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?’
Expert
Because of the consequence on demand and supply of currency and the new equilibrium. It distinguishes among real and nominal values.
5. What are the factors responsible for the recent surge in international portfolio investment?
Foreign exchange rate: The Foreign exchange rate is a price of foreign currency in terms of domestic currency.
what are the techniques of balance of payment?
Components of current account of BOP account: (A) Import-Export of goods(B) Import-Export of services(C) Unilateral transfers
If exchange rate of foreign currency downs or falls, its demand rises. Describe how? Answer: If exchange rate falls, an import become cheaper, demand for imports in
Calculate the value of imports, if the net imports are of Rs 160 crores and the value of exports are of Rs 400 crores.
Differentiate among current account and capital account of balance of payment account. State any two transactions of capital account. Answer: Q : International monetary system safeguard safeguard against the crisis of confidence in system explain
safeguard against the crisis of confidence in system explain
Deficit in balance of trade point: Deficit in balance of trade points out that the imports of good are bigger than exports.
‘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?’
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