How change in the exchange rate affect the domestic economy, Microeconomics

Assignment Help:

How might a change in the exchange rate affect the domestic economy of the country?

A change in the exchange rate - ceteris paribus - will alter relative prices between trading countries. The answer should (one again) be clear on the price of the currency, the price of exports, quantity of exports and export revenue. Clear links to the domestic economy should be seen, i.e. X and M as components of AD. A good example will then outline how a fall in the exchange rate could increase exports and export revenue, thus increasing AD - while possibly reducing import spending. References should be made to the main macro objectives.

 


Related Discussions:- How change in the exchange rate affect the domestic economy

What is Isomers and Types of Isomers, Isomers are two or more forms of comp...

Isomers are two or more forms of compounds which having the same compositions. Types of isomers (a) Stereo isomers (b) Structural isomers

find the equilibrium quantity and demand curve, Consider a non-renewable r...

Consider a non-renewable resource. There are two periods, now and later. The demand curve in each period (t = 1, 2) is Qt = 10 - Pt. The stock of the resource is 10 units. Extracti

Explain abput capitalist class, Q. Explain abput Capitalist Class? Capi...

Q. Explain abput Capitalist Class? Capitalist Class:Group of individuals (which represents just a couple of percent of population in advanced capitalist countries) which contro

Economic Principles , During the 1990s, technological advance reduced the c...

During the 1990s, technological advance reduced the cost of computer chips. Explain, with the use supply and demand diagrams, how the following markets are affected in terms of pr

Market structers, what are the majotr sources of monopoly

what are the majotr sources of monopoly

Americas Dependency on China, What will be the effects of americas dependen...

What will be the effects of americas dependency on china?

TOTAL REVENUE AVERAGE REVENUE AND MARGINAL REVENUE, CASE STUDY IN RELATION ...

CASE STUDY IN RELATION WITH TOTAL REVENUE,AVERAGE REVENUE AND MARGINAL REVENUE

Economics, Assume that a persion lives for three equal periods: Youth, Earl...

Assume that a persion lives for three equal periods: Youth, Early Adulthood and Late Adulthood. The person dies after later adulthood period ends. If one invests $200 in educatio

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd