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Q. What is the purpose of the following figure?
Answer:
The use of the figure is to show the inflation convergence within the six original EMS members. The figure demonstrates the difference between domestic inflation and German inflation for six of the original EMS members. As of 1997 every national inflation rates were very close to the German levels.
Discuss the relationship between PPP and the Law of One Price. Answer: The law of one price is applies to individual commodities while Purchasing Power Parity applies to the g
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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
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Q. Illustrate why Argentina, one of the world's richest countries at the begning of the twentieth century, has become progressively poorer relative to the industrial countries. [
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Canadian consumers have 50 dollar in come this is eual to the gross domestic product. they spand 35 dollars on comuser goods (25 on canadian goods annd 10 on imports) they save 8
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