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Explain the Exchange rate system in western world
The most common exchange rate system in western world during previous century was the fixed exchange rate system. Up to 1930s, most currencies were pegged to price of gold (the gold standard). After 2nd World War a new system was created, so-called Bretton Woods system, where every currency in the system was pegged to US dollar (USD). After collapse of this system in 1970s, many currencies, for instance, USD, have been flexible.
Balance of Payments All countries have economic transactions with other countries. These consist of import and export of goods and services, official and private gifts and don
Assume that a Mazda 2 sells for 16,000 Australian dollars in Australia and 10,000 Canadian dollars in Canada If purchasing-power parity holds, what is the Canadian dollar/Australia
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