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draw diagram of price leadership model
Q. Use the DD - AA model to examine and compare the response of an economy under fixed and floating exchange-rate regimes to a temporary fall in foreign demand for its exports.
Q. What is the policy of sterilization? Give an example. Answer: • Untainted foreign exchange intervention - policy by which central banks perform equal foreign
Q. Explain how the timing of a balance of payment crisis is determined. Be careful to state all assumptions. Answer: The assumptions of the model are: Prices are el
What will be the effects of an increase in real national income on the interest rate? Answer: An enhance in real national income will increase the interest rate. If investment
Q. What are the factors that determine the amount of money an individual desires to hold? Answer: Three major factors that are first one the expected return the asset offers co
what are the limitations of net barter terms of trade
Q. Consider the economy is initially consuming along the intertemporal budget constraint at point A, where no saving occurs. How does a fall in the real interest rate, r, and affe
Q. Discuss the effects of government deficits on the current account. Answer: A difficult and hard issue that during the Reagan administration the creation of twin deficits whe
Q. Discuss the different types of Letters of credit? Types: i. Revocable Letter of credit ii. Irrevocable Letter of credit iii. Deferred payment Letter of credit iv. Confirmed
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