uncovered interest parity

Q: How would each item be counted in the US balance of payments? Give sign, category (e.g. export, FDI,…

A: Macroeconomics is a part of economics that deals with production, decision and allocation concerning…

Q: What is Purchasing power parity Theory.

A: the Purchasing Power Parity (PPP) is an estimation that economists specialists use to look at the…

Q: The balance of payments of a country is based on the difference between the fund inflows and…

A: When talking about the balance of payment account, it is the account of a country to make record of…

Q: Explain the biggest advantage and the biggest disadvantage of fixed exchange rates compared to…

A: The term "fixed rate of exchange system" refers to a system within which the rate of exchange is…

Q: Explain the law of one price at the perspectives of purchasing power parity and interest rate…

A: The law of one price states that identical goods and services should be sold for identical prices in…

Q: Evaluate the difference between a strong and weak currency situation of a country.

A: A solid dollar implies that the U.S. dollar has ascended to a level that is close generally high…

Q: Foreign investment is counted under capital account of balance of payments.  True/False

A: In international macroeconomics the capital account of the balance of payment is account which keeps…

Q: Describe the fixed exchange rate monetary system.

A: The exchange rate is the rate at which the currency of a country is being exchanged with the…

Q: Under the Bretton Woods system of exchange rates, the official value of the U.S. dollar was fixed to…

A: "Exchange rate refers to the value of one currency in terms of another." In other words, the…

Q: Write a short note on the "Factors that influence exchange rates"

A: Exchange rate refers to the value of one currency for the purpose of conversing to another

Q: how exchange rate stability is achieve through equilibrium in balance of payment?

A: The exchange rate, as we all know, is the rate at which one currency may be exchanged for another. A…

Q: taking the benefits of a flexible exchange rate system into  consideration, defend the claim that…

A: Due to the flexible exchange system would have the growing rate and associated, with the relative…

Q: Floating exchange rate system works on the market mechanism

A: To find : Incorrect statement.

Q: Explain the effect of the terrorism of Syria on Syria currency exchange.

A: The conversion of one country's currency into another is known as foreign exchange (or forex). The…

Q: Use theories of exchange rates to explain why the value of US Dollar has been falling recently.

A: In the context of the US dollar, currency depreciation refers to the dollar's value falling in…

Q: Using an appropriate diagram of foreign exchange market, explain the concepts of currency…

A: A foreign exchange market is defined as a place where the global exchange of currencies takes place,…

Q: Write any three minutes of fixed exchange rate.

A: Under fixed exchange rate system the government has a right to set a fixed exchange rate for…

Q: How did covid 19 affect balance of payment of Africa

A: There are approximately 5 million small and medium sector businesses that are south africa based and…

Q: Q. Find any three saarc countries, Calculate effective exchange rate too.

A: South Asian Association for Regional Cooperation (SAARC)  founded in 1985.  Effective exchange rate…

Q: Most exchange rates are free-floating.  True or False

A: A free floating exchange rate is solely determined by market forces of demand and supply of foreign…

Q: A cross-border acquirer faces exchange rate risks. A. true B. false

A: The risk that changes in currency exchange rates will damage a company's operations and…

Q: what is better currency appreciation or currency depreciation?

A: If there is a fall in the value that is depreciation of the currency this will result in a fall of…

Q: Are fixed or floating exchange rates better for the eurozone countries?

A: To what extent did the euro's creation alter currency policy in the Eurozone countries? The answer…

Q: If the current U.S. interest rate is 10% and PPP is expected to hold, what should be the Canadian…

A: An economic theory known as interest rate parity (IRP) says the difference between the forward and…

Q: how the value of a currency under flexible exchange rates is determined?

A: Flexible exchange rates could be defined as exchange rates being determined by global demand and…

Q: What are the alleged advantages of a fixed over flexible exchange rate system?

A:

Q: Explain the interest parity condition – including equilibrating mechanisms.

A: Interest parity theory states that the difference between interest rates in the two countries is the…

Q: Explain supply and demand for exchange rates

A: The demand–supply framework enables you to predict the following period’s rate. once you understand…

Q: Explain how exchange rates worked under the gold standard and Bretton Woods.

A: An exchange rate is the value of currency of a nation being measured in terms of the currency of…

Q: Exchange of foreign exchange receipts Over foreign exchange payment on account of accommodating…

A: In the mentioned question, it is asked whether the Exchange of foreign exchange receipts over…

Q: the key role played by the law of one price in determining exchange rates.

A: One price law refers to the economic theory stating that identical products in different/various…

Q: Most important participant in foreign exchange markets are

A: The foreign exchange market (also known as the FX market or currencies market) is the global…

Q: Long-Run Trends in the Real Exchange Rate?

A: Long Run, implies that costs of merchandise and ventures, and of the components of creation that…

Q: Why floating exchange rate is more competitive than hard peg exchange rate?

A: In an economy whereby the supply and demand tools helps in setting the exchange rate, then such…