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Q. Explain why under fixed exchange rate, monetary policy is ineffective whereas under floating exchange rate it is effective in rising output.
Answer: In floating by purchasing domestic assets the central bank cause an initial excess supply of domestic money that concurrently pushed the domestic interest rate downward and weakens the currency. Though under fixed exchange rate the central bank will oppose any tendency of the currency to depreciate by selling foreign assets for domestic money and consequently removing the initial excess supply of money its policy move has caused.
why is international trade important for south Africa?.
Q. Suppose both governments offer their respective company a $10 million subsidy. Answer: Mutually companies would enter the market as each one knows that regardless of the o
How is the foreign exchange rate determined?
Q. Describe the effects of the Smoot-Hawley tariff imposed by the United States in 1930. Answer: It had a damaging consequence on employment abroad. The foreign response occu
Since the 1990s there has been an increasing number of Regional Trade Arrangements(RTA). According to WTO in 2012 the number of RTA increase 2 fold compared to the 90s to 497. Is r
Q. Use a figure to study the following question: Consider that the economy is at a point on the DD-AA schedule that is above both AA and DD, where both the asset and output markets
International Capital Mobility is explained below: The case for the international capital mobility was most evidently articulated by MacDougal in 1960. He presented a framework
Q. It has been argued that economic dualism that typifies relatively less developed or poor countries, is a barrier to participation in the global village, and lessens the chances
International Relations (IR) Goal : The goal of this writing assignment is for you to hone your skills in identifying accuracy or bias in movies or in "alternative" documentar
why is international trade important for south africa
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