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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.
Concept of human capital
Q. The Specific Factors model makes a distinction between general-purpose factors that can move between sectors and factors that are specific to particular uses. How do difference
1. Explain why many Asian countries set up Export Processing Zones and why China set up Special Economic Zones. What are the similarities and differences between EPZs and SEZs?
Q. Explain the difficulties in naming the new European currency. Answer: Amongst the reasons: Maintenance the name ECU would be misleading the ECU depreciated sharply ag
Explain Theoretical and methodological aspects of international economic relations
Ask questionQuestion 1: Compute various indicators of the state of the labour market using the following information. Please show all steps of your calculation. If you do not, you
Q. Why did the EU countries move away from the EMS toward the goal of a single shared currency? Answer: 1. To produce a superior degree of European market integratio
Question : (a) What are the rationales for interest and currency swaps? (b) Suppose a Swiss firm, SandyCom Ltd, wants to invest in the U.S. The Swiss firm needs US dollars
derive the eqilibrium equation for the trade balance
Q. What is a country risk index? Explain the categories classified by business environment risk information The country risk index tries to incorporate the economic , geographi
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