What are the short-run and long-run determinants of exchange rates, under the condition of free markets?

Q: Changes in which of the following will cause a change in exchange​ rates?   A. consumer preferences…

A: Exchange rates is defined as the rate at which one currency is traded for another. So, there can be…

Q: Explain what will happen to the exchange rate between the rand and the US dollar if south african…

A: The international trade has increased due to the widespread of the globalization around the world.…

Q: Do you think Balance of Payment and its different components have any role in determining the…

A: Balance of payment is a systematic record of all monetary transactions of a country with the rest of…

Q: now how to demonstrate movements of exchange rates using supply and demand graphs

A: The currency rate swings from day to day in this system due to market forces of demand and supply.

Q: In the context of the monetary approach to the determination of the exchange rate, what is the…

A: Exchange rate - The exchange tells us about the worth of the currency of one country in comparison…

Q: In the context of the monetary approach to the determination of the exchange rate, what is the…

A: A money supply curve is the supply of currency in an economy. The supply of money depends upon the…

Q: Explain how exchange rates are determined in international business

A: Exchange rate refers to the rate at which one country's currency can be exchanged for any other…

Q: what is the assignment problem

A: The objective of the assignment problem is the allocation of resources to an equal number of…

Q: In the Mundell–Fleming model with floating exchange rates, explain what happens to aggregate income,…

A: Mudell - Fleming model - This model is extension of IS-LM model . This model evaluate IS-LM model in…

Q: In the long run, exchange rates are typically affected by A. bond investors who seek long-term…

A: The exchange rates, in the long run, are affected by the bond investors seeking long-term returns.…

Q: Suppose a computer sells for US$1,200 in the U.S. and for £855 in London. If the exchange rate is…

A:

Q: Which of the following best defines an exchange rate? O rate at which one country can exchange…

A: Exchange rate is the value of one country's currency expressed in terms of the currency of another…

Q: Why do nations use a crawling peg exchange rate system? What role does speculation play in this…

A: Exchange Rate System: The exchange rate system is the system in which an exchange rate is determined…

Q: Is expansive monetary policy possible, if a country has a floating exchange rate

A: A floating exchange rate is when the value of a currency depends upon the demand and supply of the…

Q: Please provide a short and concise answer to the following question: Why are exchange rates…

A: Exchange rate is the rate at which nation's currency are exchanged . Foreign exchange is used to…

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: there is a decline in the number of  American tourists to South Africa.     Explain, with the aid of…

A: The exchange rate refers to the value of the currency of a particular country in terms of the…

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: Are international reserve needs different for different exchange rate regimes? Explain.

A: Exchange rate regime Exchange rate regime can be defined as a way through which a country manages…

Q: How does covered interest arbitrage affect the exchange rates

A: By understanding the interest arbitrage and bringing in the interest arbitraging interest rate…

Q: How can a country fix its exchange rate to another? Is it sustainable for them to maintain it fixed?

A: The regime where the government fixes its exchange rate(e) with other country is called ‘Fixed…

Q: What is a flexible exchange rate and how does it work?   What is a crawling peg and how does it…

A: The flexible exchange rate refers to the exchange rate of a country set in the international market…

Q: Discuss how exchange rates are determined in currency markets that have flexible exchange rates

A: Answer: There are three major types of exchange rate systems, Free-floating exchange rate system,…

Q: What are the basic factors that determine the value of a currency? Briefly describe how various…

A: One of the main effective ways to assess a nation's overall fiscal prosperity is to look at the…

Q: Suppose that soon after Denmark pegs to the euro, the Eurozone benefits from a favorable shift in…

A: It refers to the value of a country's currency in relation to another country's currency or an…

Q: How can the Big Mac Index explain the ability of a country's exchange rate? And how does the Big Mac…

A: The measure that depicts the value of one currency being measured in terms of another currency is…