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.
Question 1: The financial crisis that hit the United States first and then the world economy starting in fall 2007 meant that the future prospects of many firms looked gloomy at best for some time. Comment on the e
Describe the meaning of deficit in BOP: Whenever autonomous foreign exchange payments surpass autonomous foreign exchange receipts, the difference is termed as balance of payments deficit.
Flexible exchange rate: The rate of exchange in terms of other currencies is determined by market forces of demand-supply.
. In 2007 and 2008 Boeing ran into several publicized issues with regard to its management of a globally dispersed supply chain. What are the causes of these problems? What can a company such as Boeing do to make sure such problems do not occur in the future?
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
The simple circular flow model of a private economy describes how income and resources flow among: (1) Households and business associations. (2) Corporations and government agencies. (3) Sole corporations and proprietorship (4) Business associations a
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
Autonomous or public investment: It is a type of investment that is not of profit motivated.
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
If a Hawaiian can produce 50 bushels of either potatoes or pineapples per acre, whereas an Idahoan manages just 3 bushels of pineapples or 30 bushels of potatoes per acre, then: (1) Idaho’s absolute drawbacks prevent gains from specialization and exchange. (2) T
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