ECON 10020/20020 Principles of Macroeconomics
... 26. Why is the multiplier for contractionary fiscal policy smaller in an open economy? (A) Contractionary fiscal policy reduces the deficit, which raises the interest rate, which raises the foreign exchange value of the dollar, which increases net exports. (B) Contractionary fiscal policy increases ...
... 26. Why is the multiplier for contractionary fiscal policy smaller in an open economy? (A) Contractionary fiscal policy reduces the deficit, which raises the interest rate, which raises the foreign exchange value of the dollar, which increases net exports. (B) Contractionary fiscal policy increases ...
Chapter II (pdf format)
... indirect quote. Note that we usually think that the good in the denominator is the one changing in value (against the domestic currency). Example II.3: Calculating the appreciation and depreciation of the currency. Go back to Example II.2. Now, we want to calculate the change in value of the domesti ...
... indirect quote. Note that we usually think that the good in the denominator is the one changing in value (against the domestic currency). Example II.3: Calculating the appreciation and depreciation of the currency. Go back to Example II.2. Now, we want to calculate the change in value of the domesti ...
1 ECO 328 – SUMMER 2004--Sample Questions
... A permanent increase in a country’s money supply causes a proportional longrun depreciation of its currency against foreign currencies. B. A temporary increase in a country’s money supply causes a proportional longrun depreciation of its currency against foreign currencies. C. A permanent increase i ...
... A permanent increase in a country’s money supply causes a proportional longrun depreciation of its currency against foreign currencies. B. A temporary increase in a country’s money supply causes a proportional longrun depreciation of its currency against foreign currencies. C. A permanent increase i ...
Putting the `system` in the international monetary system
... monetary systems which created a system of fixed exchange rates as almost a by-‐product. In contrast, in 1944 the architects of the Bretton Woods system were intentional – they were building an internat ...
... monetary systems which created a system of fixed exchange rates as almost a by-‐product. In contrast, in 1944 the architects of the Bretton Woods system were intentional – they were building an internat ...
Can the Euro rival the United States dollar and become the world
... From the end of 2008 to present, the US economy has been experiencing the most serious recession and slowest recovery since the Second World War. The GDP of the US contracted by 0.3% in 2008 and then a further contraction of 3.5% in GDP occurred in 2009; the most serious contraction since World War ...
... From the end of 2008 to present, the US economy has been experiencing the most serious recession and slowest recovery since the Second World War. The GDP of the US contracted by 0.3% in 2008 and then a further contraction of 3.5% in GDP occurred in 2009; the most serious contraction since World War ...
Rolling Back the Strong Yen under a Dollar Reserve Currency Regime
... In this report, we begin by examining the sustainability of the dollar reserve currency regime. A reserve currency denotes a leading international currency which exhibits such features as high liquidity, stable value, and acceptance as a common measure of value. A certain number of conditions must b ...
... In this report, we begin by examining the sustainability of the dollar reserve currency regime. A reserve currency denotes a leading international currency which exhibits such features as high liquidity, stable value, and acceptance as a common measure of value. A certain number of conditions must b ...
Paper III - Is East Africa an Optimum Currency Area
... for monetary policy in the individual countries. They further argue that to the extent that such open economies are integrated in terms of capital flows, labour mobility, or similar economic behaviour, the need to maintain the exchange rate as a policy instrument in individual countries becomes less ...
... for monetary policy in the individual countries. They further argue that to the extent that such open economies are integrated in terms of capital flows, labour mobility, or similar economic behaviour, the need to maintain the exchange rate as a policy instrument in individual countries becomes less ...
I. Exchange Rates
... exchange rates introduces uncertainty into international transactions • 2. There are two major benefits of fixed exchange rates • 3. But there are some disadvantages to fixed exchange rates ...
... exchange rates introduces uncertainty into international transactions • 2. There are two major benefits of fixed exchange rates • 3. But there are some disadvantages to fixed exchange rates ...
exchange rate
... Chapter 9: The Foreign Exchange Market Other Steps for Managing Foreign Exchange Risk To manage foreign exchange risk: • central control of exposure is needed to protect resources efficiently and ensure that each subunit adopts the correct mix of tactics and strategies • firms should distinguish be ...
... Chapter 9: The Foreign Exchange Market Other Steps for Managing Foreign Exchange Risk To manage foreign exchange risk: • central control of exposure is needed to protect resources efficiently and ensure that each subunit adopts the correct mix of tactics and strategies • firms should distinguish be ...
Fundamentals, Contagion and Currency Crises
... Non-structural models of currency crises fall into two broad categories: those based on non-parametric tests and those based on probit regressions. The nonparametric approach was popularised by Eichengreen, Rose and Wyplosz (1995). Using quarterly data for members of the exchange rate mechanism (ERM ...
... Non-structural models of currency crises fall into two broad categories: those based on non-parametric tests and those based on probit regressions. The nonparametric approach was popularised by Eichengreen, Rose and Wyplosz (1995). Using quarterly data for members of the exchange rate mechanism (ERM ...
Document
... had increasing difficulties in raising additional capital in support of its reserves on the international markets. • By mid-August, the Russian Central Bank announced it would allow the rouble to fall, postponed short-term domestic debt service and initiated a moratorium on all repayment of foreign ...
... had increasing difficulties in raising additional capital in support of its reserves on the international markets. • By mid-August, the Russian Central Bank announced it would allow the rouble to fall, postponed short-term domestic debt service and initiated a moratorium on all repayment of foreign ...
Newsletter 30/2013
... policy debates are often multidimensional since the policies entail a bundle of features important to voters. We utilize an experimental approach that allows scholars to deal with the multidimensionality of policy preferences and apply it to study voter preferences regarding Eurozone bailouts, a pol ...
... policy debates are often multidimensional since the policies entail a bundle of features important to voters. We utilize an experimental approach that allows scholars to deal with the multidimensionality of policy preferences and apply it to study voter preferences regarding Eurozone bailouts, a pol ...
Issues on the choice of Exchange Rate Regimes1 Ashwin Moheeput
... In essence, a currency board can be viewed as a consolidated exchange rate and monetary package because of its direct implications for exchange rate and monetary management. For reasons that will be clear as we progress along with the discussion, it will be safe to view currency boards as a holistic ...
... In essence, a currency board can be viewed as a consolidated exchange rate and monetary package because of its direct implications for exchange rate and monetary management. For reasons that will be clear as we progress along with the discussion, it will be safe to view currency boards as a holistic ...
Principles of Economics Third Edition by Fred Gottheil
... 4. Continuing the Mexican peso example, what might Mexico be forced to do if it did not have a sufficient quantity of pesos on reserve to eliminate the excess demand? •Mexico might be forced to borrow pesos from another country, or even agree to increase the exchange rate ($ per peso). ...
... 4. Continuing the Mexican peso example, what might Mexico be forced to do if it did not have a sufficient quantity of pesos on reserve to eliminate the excess demand? •Mexico might be forced to borrow pesos from another country, or even agree to increase the exchange rate ($ per peso). ...
If You`re So Smart: John Maynard Keynes and Currency Speculation
... taking substantial risks and withstanding prolonged periods of losses, a fact that might explain why their profits were not arbitraged away. Our second result is that in the 1920s and 1930s implementing a currency trading strategy based on the analysis of macroeconomic fundamentals was challenging ( ...
... taking substantial risks and withstanding prolonged periods of losses, a fact that might explain why their profits were not arbitraged away. Our second result is that in the 1920s and 1930s implementing a currency trading strategy based on the analysis of macroeconomic fundamentals was challenging ( ...
Currency
A currency (from Middle English: curraunt, ""in circulation"", from Latin: currens, -entis) in the most specific use of the word refers to money in any form when in actual use or circulation as a medium of exchange, especially circulating banknotes and coins. A more general definition is that a currency is a system of money (monetary units) in common use, especially in a nation. Under this definition, British pounds, U.S. dollars, and European euros are examples of currency. These various currencies are stores of value, and are traded between nations in foreign exchange markets, which determine the relative values of the different currencies. Currencies in this sense are defined by governments, and each type has limited boundaries of acceptance.Other definitions of the term ""currency"" are discussed in their respective synonymous articles banknote, coin, and money. The latter definition, pertaining to the currency systems of nations, is the topic of this article. Currencies can be classified into two monetary systems: fiat money and commodity money, depending on what guarantees the value (the economy at large vs. the government's physical metal reserves). Some currencies are legal tender in certain jurisdictions, which means they cannot be refused as payment for debt. Others are simply traded for their economic value. Digital currency arose with the popularity of computers and the Internet.