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Q. Using the GG - LL framework, analyze the effect of an increase in the size and frequency of sudden shifts in the demand for a country's exports.
Answer: Such a alter pushes LL upward and to the right. Therefore the level of economic integration at which it becomes worthwhile to join the currency rises. Generally increased variability in the product markets makes countries less willing to enter fixed exchange rate areas. This prediction assists explain why the oil price shocks after 1973 made countries unwilling to revitalize the Bretton Woods system of fixed exchange rates.
Q. What are the main lessons economists learned from the developing country crisis? Answer: 1. select the right exchange rate regime. 2. The central significance of
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
Q. In the year 2000, Americans flocked to Paris. What economic forces made French goods seem so cheap to residents of the United States? Answer: One main factor was a sharp f
Q. How can international trade in assets make both countries better off? Answer: By permitting them to reduce the riskiness of the return on their wealth and by allowin
Q. An export subsidy has the reverse effect on terms of trade to the effect of an import tariff. Domestically a tariff will raise the price of the import good, deteriorating the
Q. Explain Critical Appraisal of Chamberlins theory? a. Chamberlin assumed that monopolist competitors act independently and their price manicuring goes unnoticed by the rival
Q. Use a figure to study the following question: Consider that the economy is at a point on the DD-AA schedule that is above both AA and DD, where both the asset and output markets
how is exchange rate determined?
Explain about International economic integration. EU
In a day of production, firms in angola can produce 200 liters of oil or 10 kilograms of tungsten. Firms in Namibia can produce 160 liters of oil or 60 kilograms of tungsten. Which
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