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Q. What are the three main reasons why governments sometimes chose to devalue their currencies? Answer: 1. Permit the government to fight domestic unemployment despite the
Q. What is the Fisher Effect? Provide an example. Answer: All moreover equal a rise in a country's expected inflation rate will ultimately cause an equal rise in the i
Q. How were the initial members of EMU chosen? How will new members be admitted? What is the structure of the complex of financial and political institutions that govern economic
Q. It has been argued that economic dualism that typifies relatively less developed or poor countries, is a barrier to participation in the global village, and lessens the chances
Q. What is the domino effect or contagion? Answer: The definition is the defencelessness of even seemingly healthy economies to crisis of confidence generated by events
Q. What are the main points of economic life that macroeconomics analysis is most concerned with? Answer: There are four major aspects that are saving, unemployment, trade imb
Q. Explain the difference between the following two expressions: Y = C(Y d ) + I + G + CA(EP*/P, Y d ) and Y = C + I +G + CA Answer: The first expression corresponds to a
how is exchange rate determined?
Since the 1990s there has been an increasing number of Regional Trade Arrangements(RTA). According to WTO in 2012 the number of RTA increase 2 fold compared to the 90s to 497. Is r
Is a depreciation of the dollar/euro exchange rate correlated with a decrease in the dollar return on U.S. deposits? Answer: No, suppose that the Interest Parity is maintained
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