ECONOMICS TODAY: MICRO VIEW >CUSTOM<
ECONOMICS TODAY: MICRO VIEW >CUSTOM<
19th Edition
ISBN: 9781323850817
Author: Miller
Publisher: PEARSON C
Question
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Chapter 33, Problem 14P
To determine

Impact on foreign reserves in case of changes in the value of Yuan currency.

Concept Introduction:

Appreciation: It is the increase in the value of domestic currency in terms of the foreign currency when the exchange rate is freely determined by forces of demand and supply.

Depreciation: It is the decrease in the value of domestic currency in terms of the foreign currency when the exchange rate is freely determined by forces of demand and supply.

Foreign Exchange Reserves: This is the amount of foreign currency reserves that are held by the Central Bank of a country.

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