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Q. Discuss the effects of the reunification of eastern and western Germany in 1990 on both Germany and its neighboring European countries.
Answer: Germany rumbles high interest rates to fight inflation. Other European countries Italy, France and UK in recession trying to match the High German interest rates to hold their currencies fixed against Germany's thus pushing their economies into deep recession. Other European countries struggle to continue the fixed exchange rate in order not to lose the trustworthiness they had built up since 1985. The policy divergence between Germany and the other European countries led to a series of fierce speculative attacks on the EMS exchange parities starting in September 1992. By August 1993 the EMS was compulsory to retreat to very wide (+- 10 percent) bands which were kept in compel until the introduction of the euro in 1993.
Q. Explain why price levels are lower in poorer countries. Answer: One theory explicate the difference in prices on different endowments of capital and employment Bhagw
what is this theroy
Q. Why did the Fed step in to organize a rescue for Long Term Capital Management (LTCM) in September 1998, rather than simply letting the trouble fund fail? Was the Fed's action
I need help interpreting an article. PLEASE!
Q. "The balance of payments accounts seldom balance in practice." Discuss. Answer: True the major reasons are due to the fact that data received or collected from different so
Q. What is the interest parity condition? Answer: The circumstance that the expected returns on deposits of any two currencies are equal when measured in the same currency is
WHATE IS THE PROPERTY OF OFFER CURVE OF A COUNTRY
Q. Use the DD - AA model to examine and compare the response of an economy under fixed and floating exchange-rate regimes to a temporary fall in foreign demand for its exports.
Q. Discusses the effects of a rise in the interest rate paid by euro deposits on the exchanger rate. Answer: For a known U.S. interest rate and a given expectation wi
Q. The Specific Factors model clearly illustrates how the expansion of trade can have significant distributional effects on the relative incomes of different factors of productio
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