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Q. Based on the case study, answer the following question: Can currency boards make low-inflation policies credible?
Answer: Currency boards have the power to bring in anti-inflation credibility from the country to which the domestic currency is hook. Currency boards usually mayn't acquire government debt however it can discourage fiscal deficits leading to reduce a major cause of inflation and devaluation. In command for a currency board to be successful is by increasing the banking sector and that is able to get the government under pressure to abandon the currency board. Additionally if the markets anticipate that the government is leaving the currency board the country mayn't benefit from the potential of a currency board.
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Q. Countries do not in fact export the goods the H.O. theory predicts. Discuss. Answer: This statement isn't true that though one may find several cases where it seems to be
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Q. Explain why even owners of capital that cannot be moved can avoid more of the economic stability loss due to fixed exchange rates when Norway's economy is open to capital flows
In as much as Sovereign Wealth Funds (SWFs) are established to achieve national objectives, the intentions of the United Arab Emirates -- one of the world's largest -- are open to
Q. Using the DD - AA framework, show the phenomenon of overshooting. Use a figure to explain when it is taking place. Answer: The figure below illustrates the phenomenon of ov
Is there is Few or many national currencies
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Q. Neoclassical and Classical trade theory makes the case that free trade can bring a country to an optimum and economically efficient use of its resources; and therefore is an op
International Capital Mobility is explained below: The case for the international capital mobility was most evidently articulated by MacDougal in 1960. He presented a framework
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