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Q. Explain why in exchange rate-based stabilization plan may result in a real appreciation?
Answer: annotation 8 gives three reasons: first, persistent inflation because of say lagged wage indexation; second, be deficient in of credibility of the policy; and third, productivity shifts because of inflation reduction or efficient reforms.
Q. The U.S. is most probably the most open international market among the industrialized countries. What then does the U.S. have to took by joining the WTO? Answer: There ar
Q. Explain the purpose of the given figure? Answer: To demonstrate that spot and forward exchange rates are in general close to each other.
Q. Use the fixed exchange rate DD - AA model to describe the economy's short-run equilibrium. Then, use the same figure to study an expansionary monetary policy. Show that the pol
According to the Linder theory, trade will occur in goods that have overlapping demand. With aid of a graph, illustrate this theory and its implications. Make use of graph
Q. Using an equation, explain why governments prefer to avoid excessive current account surpluses. Answer: This pursue from the national income identity S = CA + I which says
what is leontiff paradox.
Explain Theoretical and methodological aspects of international economic relations
Q. What are the three types of transactions between the residents of different countries? Answer: 1. Trades of services and goods for goods or services. 2
haberler''s opportunity cost theory
briefly summaries the alternative explanation to the theory of international trade?
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