Rise in the exchange rate-always good news
‘The pound has enhanced today on the foreign exchange market’ is a general media comment whenever the pound sterling appreciates. When the pound appreciates is it always excellent news for business and the economy?’
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The result of exchange rate modifications on imports and exports and how such changes have various effects on business and the economy in booms and recessions.
Components of current account of BOP account: (A) Import-Export of goods(B) Import-Export of services(C) Unilateral transfers
Components of capital account of balance of payment: A) Borrowing and lending to and from abroad.B) Change in foreign exchange reserves C) Investment to and from abroad.
Autonomous or public investment: It is a type of investment that is not of profit motivated.
Explain all the approaches of Paul Samuelson.
Who rediscovered Bachelier’s thesis?
. 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?
Define foreign exchange: It is the currency other than domestic currency.
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.
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.
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
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