Explain the currency exchange rate in international trade? Explain the concept of a fixed exchange rate and floating exchange rate?
An international exchange rate is the cost of one nation's money as far as another nation's cash. Outside trade rates are relative and are communicated as the estimation of one currency contrasted with another. When selling items universally, the conversion standard for the two exchanging nations' monetary forms is a significant factor. International trade rates, truth be told, are one of the most significant determinants of a nations relative degree of monetary wellbeing, positioning soon after loan fees and expansion. Trade rates assume an indispensable job in a nation's degree of exchange, which is basic to practically every free market economy on the planet. Subsequently, trade rates are among the most viewed, broke down, and controlled monetary measures. The consequences of organizations that work in more than one country regularly should be "made an interpretation of" from outside monetary forms into U.S. dollars. Swapping scale variances make budgetary anticipating progressively hard for these organizations, and furthermore markedly affect unit deals, costs, and expenses.
Fixed and floating
A fixed rate indicates a nominal conversion scale that is set immovably by the money related authority as for outside cash or a bin of remote monetary standards. Conversely, a floating exchange rate is resolved in outside trade markets relying upon request and supply, and it by and large varies continually.
A fixed rate system lessens the exchange costs suggested by conversion standard vulnerability, which may demoralize universal exchange and speculation, and gives a solid stay to low-inflationary money related arrangement.
A fixed rate scale system diminishes the exchange costs suggested by swapping scale vulnerability, which may demoralize universal exchange and speculation, and gives a solid stay to low-inflationary money related approach. Then again, self-sufficient fiscal strategy is lost right now; the national bank must continue mediating in the outside trade market to keep up the swapping scale at the authoritatively set level. Autonomous money related arrangement is in this way a major favorable position of a coasting conversion standard. In case that the household economy slips into downturn, it is self-governing fiscal strategy that empowers the national bank to help request, accordingly 'smoothing" the business cycle, for example lessening the effect of monetary stuns on household yield and business.
Explain the currency exchange rate in international trade? Explain the concept of a fixed exchange rate...
The Euro currency is fixed against other currencies on the international currency exchange markets, but allows member country currencies to float against each other (T/F) Why?
The rate at which a foreign exchange dealer converts one currency into another currency on a particular day is the Multiple Choice o forward exchange rate. O fixed exchange rate. O future exchange rate. o spot exchange rate. O floating exchange rate.
Explain how balance of payment crises and currency crises might arise under fixed exchange rate regime. Explain how balance of payment crises and currency crises might arise under fixed exchange rate regime.
The exchange rate for a foreign currency that is determined by supply and demand is Group of answer choices a constrained exchange rate. a floating exchange rate. a fixed exchange rate. a controlled exchange rate.
a. Report on the history of the exchange rate of China's currency: Was it fixed or flexible? Was it ever pegged to a major world currency? Is it currently fixed or flexible? Is it freely convertible? b. The United States recently labeled China a currency manipulator. Do internet research and find at least one article that argues that this is justified and another that argues that China is not currently manipulating its currency (even if it might have done so...
In a fixed exchange rate system, a government intervenes to maintain the value of her currency at a fixed (target) value. Suppose that the equilibrium price (from the foreign exchange market) for the country’s currency is below the target rate that the government is trying to achieve. How should the government intervene in the currency market?
Use the concept of the real exchange rate to explain why high rates of inflation in a country are seen as a problem. Is this problem worse under a fixed or flexible exchange rate regime?
answer these 4 . will rate after The exchange rate for a foreign currency that is determined by supply and demand is O a constrained exchange rate. O a floating exchange rate. O a fixed exchange rate. O a controlled exchange rate. in bank An open-market purchase of government bonds by the Fed results in reserves and in the supply of money. O an increase; a decrease O a decrease; a decrease O an increase; an increase O a decrease;...
Compare the advantages/disadvantages of fixed (or pegged) exchange rate versus floating exchange rate. Define what are fixed, pegged, and floating exchange rate. Provide examples.
please complete these problems 3-6 Class An exchange rate is a number that describes how much of one currency you can trade for another currency. For example, if the U.S. exchange rate for Canadian currency is 1.2, it means that you could trade one U.S. dollar for $1.20 Canadian. When travelers talk about how expensive or cheap a certain country is, it's often a reflection of the exchange rate. The Big Mac costs mentioned earlier? The average cost in the...