last seberal yeare, Assume that on the Cwerage he inflathion in Vumam is 5% in us 2 , the Vietnamese domestic sector imports 20 billion uso goode/ year, in crease In important tox to ue, and Hhe ue rank 5 th in the most productive contries in the wonld. what will happen to alue of YND to USD in long-term Cother jactora conctant)?
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- Define nominal exchange rate and ·eal exchange rate. and explain howthey are related. If the nomwal exchange rate goes from 100 to 120yen per dollar, has the doflar apprectated or deprectated?The United States exports14%ofGDP while Germany exports about 50% of it sGDP.Explain wha ttha tmeans.What would be the effect of a devaluation on a country’s imports and exports? If a country imports most ofthe goods included in the basket of goods and servicesused to calculate the CPI, what do you think the effectwill be on this country’s inflation rate?
- ) Consider the following open economy SImodel set upY = 18000C = 300 + 0.8(Y − 2500)I = 3500 − 400(r)r = r* = 5G = 3000T = 2500(a) Compute public savings. How much isnational savings, S?(b) Compute Net Exports.Zeta Corporation is a Philippine ExportCompany. It sells its goods to the US.Assuming that the BSP prints morePhilippine peso bills, how will thesales of Zetabe affected? A. The decrease in money supply will increase the value of each peso, require less peso to get one USD, hence Zeta's sales in peso will decrease.B. The increase in money supply will increase the value of each peso, require less peso to get one USD, hence Zeta's sales in peso will decrease.C. The decrease in money supply will lower the value of each peso, require more peso to get one USD, hence Zeta's sales in peso will increase.D. The increase in money supply will lower the value of each peso, require more peso to get one USD, hence Zeta's sales in peso will increase.Only like if no ai or downvoted for ai content Suppose that the equilibrium exchange rate between the United States and South African is 15.13 Rand per US dollar. Further suppose that the two countries are trading partners with each other. Inflation now rises in South Africa. Which of the following answer choices correctly represents the shift that would occur in the US foreign exchange market? The supply of US dollars would fall. The demand for South African Rands would rise. The supply of South African Rands would rise.
- The Foreign Exchange MarketThe Jamaican dollar experienced a rapid depreciation in the exchange rate during 2020 due to thepandemic's impact on key sectors. The exchange rate in 2020 closed at J$142.65 to US$1.00,after opening the year at J$132.57, resulting in a 7.6 per cent depreciation. As at FridaySeptember 16, 2022, the exchange rate was at approximately $ JA 150 to US $1.QUESTIONGiven this rapid depreciation of the Jamaican dollar against the US dollar,should the government of Jamaica adopt a Fixed Exchange Rate regime ormaintain the current Floating Rate regime?Outline to answering the question Clear distinction between fixed exchange rate and floating exchange rate, Examples of countries that uses fixed exchange rate regime and those that uses floatingexchange rate regime and Arguments for and against floating exchange ratedetermine the purchasing power of the country China for aconsumer good that they would buy from their Canadian trading partner. Also, calculate whatCanada’s purchasing power is with a country that they import from. See example below on Coca Colaand Mexico. Purchasing Power Example In the example of the picture, if a Canadian company operating in Mexico were to pay its Mexican employeesthe equivalent of $10/hour CAD (or 100 pesos/hour according to our fictional exchange rate), theMexican employee would actually enjoy greater purchasing power (the ability to acquire 20 colasversus only 10 colas) than his/her Canadian counterparts.Explain a Pakistan’s current investment climate
- Answer the following questions 1.a. Today many Central Banks around the World are thinking of increasing interestrates. Why? What could be the dangers of increasing those interest rates toomuch?1.b.What will happen to the trade balance and the real exchange rate of a smallopen economy when govemment purchases increase, such as during a war?Does your answer depend on whether this is a local war or a global war? Onthose grounds, In the current situation of the Russian invasion, what shouldhappen between the dollar and the Euro?The Foreign Exchange MarketThe Jamaican dollar experienced a rapid depreciation in the exchange rate during 2020 due to thepandemic's impact on key sectors. The exchange rate in 2020 closed at J$142.65 to US$1.00,after opening the year at J$132.57, resulting in a 7.6 per cent depreciation. As at FridaySeptember 16, 2022, the exchange rate was at approximately $ JA 150 to US $1 Arguments for and against fixed exchange rate.Purchasing-power parity holds between the nationsof Ectenia and Wiknam, where the only commodityis Spam.a. In 2020, a can of Spam costs 4 dollars in Ecteniaand 24 pesos in Wiknam. What is the exchange ratebetween Ectenian dollars and Wiknamian pesos?b. Over the next 20 years, inflation is expected to be3.5 percent per year in Ectenia and 7 percent peryear in Wiknam. If this inflation comes to pass,what will the price of Spam and the exchangerate be in 2040? (Hint: Recall the rule of 70 fromChapter 27.)c. Which of these two nations will likely have ahigher nominal interest rate? Why?d. A friend of yours suggests a get-rich-quickscheme: Borrow from the nation with the lowernominal interest rate, invest in the nation with thehigher nominal interest rate, and profit from theinterest-rate differential. Do you see any potentialproblems with this idea? Explain.
