True/False and Explain The exchange rate between two countries can be thought of as unrelated to any economic variables.

Q: Other things the same, as the price level falls, a country’s exchange rate   and interest rates…

A: Price level of certain goods and services demanded in the economy effects the various parameters…

Q: trade plays an important role in the development of any economy. ii. If there is expansionary fiscal…

A: Economic growth  1) The economic growth refers to situation when there is a monetary increase in…

Q: How are both the real interest rate, r, and the real exchange rate, Q, actually determined?

A: The inflation rate is the difference between the actual and nominal interest rates. (The nominal…

Q: what excactly is a fixed exchange rate and give an example of a country that has a fixed exchange…

A: "The rate at which one country's money is exchanged for another country's currency is known as the…

Q: Using examples, demonstrate how exchange rate forecasting is approached?

A: The exchange rate of a country is the price of one currency in terms of another. It is used when the…

Q: An exchange rate is best described as? A)The price of goods in terms of a foreign currency B)The…

A: Exchange rate is are of two types: Fixed exchange rate and Flexible exchange rate. Fixed exchange…

Q: WHAT IS THE IMPORTANCE OF EXCHANGE RATE IN OUR ECONOMY

A: Meaning of Macroeconomics: The term macroeconomics refers to the situation of economic and…

Q: Distinguish between nominal and real exchange rate in an open economy. Explain with the aid of a…

A: The rate at which one currency will be exchanged for another is known as the exchange rate. It is…

Q: If the productivity or the productivity of the workforce decreases_______? Group of answer choices…

A: An open economy is one whose domestic production and domestic demand affect its currency value in…

Q: Evaluate how does one judge whether exchange rate is at an appropriate or not? Expound your answer.

A: In order to judge the appropriate level of exchange rate, trends in REER -Real Effective Exchange…

Q: Using Diagrams show the impact on a country’s exchange rate when: a. Rise in the domestic price of…

A: a. Rise in the domestic price of exports will increase the export as they are getting higher prices.…

Q: True / False Question , explain breifly ( 3 sentences would be enough ) 1. A trade deficit must be…

A: Since you have asked multiple questions, we will solve the first question for you. If you want any…

Q: Many developing countries, like Mexico, have moderate to high rates of inflation. At the same time,…

A: There is high inflation in many developed countries, such as México. As inflation is high currency…

Q: How do the nominal exchange rate and the real exchange rate differ? How do we find the real exchange…

A: The exchange rate is a rate at which one currency is exchanged for another. It helps to find the…

Q: Choose the correct answer and give correct explaination 2. Advantages of a flexible exchange rates…

A: In the international market, flexible exchange rate system refers to the changes in the value of a…

Q: Analyse, using demand and supply analysis, the relationship between i) inflation and exchange rate…

A: A general rise in price is referred to as inflation. The consumer price index is used to measure it.…

Q: How do wars and pandemics affect a country's nominal exchange rate, interest rate, and production?

A: The nominal exchange rate basically determines that how much local money is required to acquire…

Q: Nominal exchange rate Real exchange rate Spot rate

A: Hello. Since your question has multiple sub-parts, we will solve the first three sub-parts for you.…

Q: Using the concept of "carry trade," explain how a decrease in U.S. interest rates could affect the…

A: Carry trade is a strategy when the funds are withdrawn from the country with low rate of interest…

Q: An economy is described by the following two equations.       Y = C (Y – T) + I (r* ) + G –…

A: Y = C (Y – T) + I (r* ) + G – NX(e) The above model depicts the aggregate demand in an economy. It…

Q: If Bangladesh follows a fixed exchange rate and perfect capital mobility, explain with the help of…

A: A policy is a collection of concepts or strategies, specifically in politics, economics, or trade,…

Q: Explain fixed exchange rate in Malaysia.

A: A fixed exchange rate means a nominal exchange rate that is set jointly by the monetary authority…

Q: explain like the case written below, but change the fixed exchange with freely exchange rate. what…

A: The notations and subscripts are not clearly visible hence I am using my own. Please relate to that.…

Q: When the exchange rate for a currency rises and becomes stronger, we say that the currency's value…

A: When a currency appreciates, it means it increased in value relative to a different currency;…

Q: Define overvalued exchange rates. Discuss four ways in which governments policymaker can respond to…

A: An exchange rate between two currencies is the rate at which one currency is traded for another. The…

Q: Define overvalued exchange rate.

A: Hello. Since your question has multiple parts, we will solve the first question for you. If you want…

Q: In the Mundell-Flemming model with floating exchange rates, explain what happens to aggregate…

A: Answer: Introduction: Mundell-Flemming model explains open economy macroeconomic adjustments under…

Q: What are demand-related factors and supply-related factors, that may influence exchange rate…

A: The economics of supply and demand indicates that if demand is greater, prices increases and the…

Q: When more than one government intervenes to move the value of an exchange rate, this is known as…

A: Answer: Correct option: 3 (Coordinated) Explanation: When more than one government intervenes to…

Q: What is capital flight? When a country experiences capital flight, what is the effect on its…

A: Capital flight refers to the situation where assets or money rapidly flows out of the country…

Q: ch one iS king or (a) Fixed exchange rate (b) Flexible exchange rate c) Both (a) and (b) d) None of…

A: According to the given question the king of the exchange rate is the OPTION(C) IS THE CORRECT ANSWER…

Q: Explain how nominal exchange rate affects real exchange rate.

A: The nominal exchange rate can be understood as that how much amount of foreign exchange can be…

Q: An increase in the value of domestic currency in terms of foreign currencies under fixed exchange…

A: According to the given question In simple words we can say that a foreign exchange rate it is…

Q: Give reasons, supported with clear explanations, why countries opt for a floating exchange rate?

A: The exchange rate is the rate at which domestic currency is exchanged with foreign currency in the…

Q: Empirical studies find that exchange rates are much more variable then   inflation differentials.…

A: The exchange rate refers to the relative value of a currency in terms of other foreign currencies.…

Q: Draw graphs to show the effect of expansionary fiscal and monetary policies on the economy under…

A: Robert Mundell and Fleming wrote the theorem when there was a fixed exchange rate system. The model…

Q: QUESTION 2 In the long run, an increase in the nominal exchange rate is likely to lead to Note:…

A: please find the answer below.

Q: Explain why a country with fixed exchange rate and open financial markets has to give up its…

A: The theory that depicts that countries might tend to choose among options while making decisions…

Q: Show graphically and explain how increasing import influence exchange rate

A: The equilibrium of trade influences cash trade rates through its effect on unfamiliar trade supply…

Q: Using a relevant exchange rates theory discuss how the movements of the exchange rates- a uneven…

A: Exchange rate movements are the change is the value of exchange rate of a currency. This happens due…