Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
Q. Show the Changes in the exchange rate?
Assume that United States is our home country and the current euro exchange rate in direct notation is SD = 1.5 (euro/USD). In indirect notation, SI = 0.667 (USD/euro). If euro becomes more costly in terms of the USD we say that USD has depreciated against the euro (lost in value). It means that SD has increased (to say SD = 1.6) and that SI has fallen (to 0.625). If euro becomes less expensive we say that USD has appreciated against the euro. In such a case, SD will fall and SI will increase. Obviously, when USD depreciates against the euro, euro appreciates against the USD.
Remember:
A foreign currency is more expensive Û domestic currency has depreciated
A foreign currency is less expensive Û domestic currency has appreciated
Also keep in mind that whenever a currency depreciates, S will increase if we use direct notation and decrease if we use indirect notation.
If a country has a fixed exchange rate (say against a particular currency), government or central bank may change this fixed exchange rate. Suppose that Hong Kong is our home country and that Hong Kong dollar (HKD) is fixed against USD at the exchange rate 7.8 HKD/USD (direct notation). If central bank in Hong Kong changes this exchange rate to say 8.2 HKD/USD it makes foreign currency more expensive and HKD cheaper. In this case we say that HKD has beendevalued. Though, if exchange rate is changed to say 8.6 HKD/USD we say that HKD has been revalued.
Benefits of Regional Integration Most economic experts cite that regional integration permits disadvantaged countries to realize economies of scale, vie on a broader (often gl
define history and full deatil of command economy
Application of Revealed Preference Approach It has been strongly argued, especially by Sir John Hicks, that one major advantage of revealed preference theory is that it is expl
Compare the three investments below in terms of their riskiness. What is the best way to evaluate the riskiness of an investment given the information you have on them? Project Exp
using a graph of the classical labour market,illustrate the effects of a real wage existing in the market that is lower than the equilibrium real wage.What will eventually happen i
The system where workers concentrate on specialized tasks to make a product is referred to as: A. Coincedence of wants B. Roundabout production C.Freedom of enterprise
What advantages might a socialist system have in responding to the needs of people struck by an emergency situation like the earthquake that occurred in Haiti in January, 2010?
Commercial Banks: Balance Sheet The accompaning table gives the balance sheet of a commercial bank in a simplified format. The balance sheet contains particulars of a Bank's cu
Properties of indifference curve: Property I: Higher indifference curve gives higher utility. Explanation: Since all goods are non-satiated, larger consumpti
Gross Domestic Savings Income not devoted to current consumption is saved. In an economy during a particular year some units will consume less than their income while some wi
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!
whatsapp: +91-977-207-8620
Phone: +91-977-207-8620
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd