This topic contains a solution. Click here to go to the answer
« previous next »

Author Question: Please draw a figure illustrating the actions the central bank must take to maintain a fixed ... (Read 137 times)

bclement10

  • Hero Member
  • *****
  • Posts: 560
on: Jun 30, 2018
Please draw a figure illustrating the actions the central bank must take to maintain a fixed exchange rate following an increase in output.
 
  What will be an ideal response?

Question 2

The euro is said to be selling at a ________ if the spot dollar price is 1.18 and the nine-month forward rate is 1.16.
 
  A) forward discount
  B) forward premium
  C) forward spread
  D) none of the above


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

carojassy25

  • Sr. Member
  • ****
  • Posts: 299
Reply #1 on: Jun 30, 2018
Answer to Question 1

A rise in output from to will increase the real money demand, so the central bank must purchase foreign assets and raise the money supply from to , in order to maintain a fixed exchange rate .

Answer to Question 2

A


bclement10

  • Member
  • Posts: 560
Reply 2 on: Jun 30, 2018
:D TYSM

Laurenleakan

  • Member
  • Posts: 309
Reply 3 on: Yesterday
Wow, this really help

« previous next »
 

Did you know?

Intradermal injections are somewhat difficult to correctly administer because the skin layers are so thin that it is easy to accidentally punch through to the deeper subcutaneous layer.

Did you know?

Every 10 seconds, a person in the United States goes to the emergency room complaining of head pain. About 1.2 million visits are for acute migraine attacks.

Did you know?

Although the Roman numeral for the number 4 has always been taught to have been "IV," according to historians, the ancient Romans probably used "IIII" most of the time. This is partially backed up by the fact that early grandfather clocks displayed IIII for the number 4 instead of IV. Early clockmakers apparently thought that the IIII balanced out the VIII (used for the number 8) on the clock face and that it just looked better.

Did you know?

Stevens-Johnson syndrome and Toxic Epidermal Necrolysis syndrome are life-threatening reactions that can result in death. Complications include permanent blindness, dry-eye syndrome, lung damage, photophobia, asthma, chronic obstructive pulmonary disease, permanent loss of nail beds, scarring of mucous membranes, arthritis, and chronic fatigue syndrome. Many patients' pores scar shut, causing them to retain heat.

Did you know?

The types of cancer that alpha interferons are used to treat include hairy cell leukemia, melanoma, follicular non-Hodgkin's lymphoma, and AIDS-related Kaposi's sarcoma.

The Lion Gate of Mycenae (detail)—two lionesses flank the central column, c. 1300 B The Lion Gate of Mycenae (detail)—two lionesses flank the central column, c. 1300 B
Myopia (nearsightedness). In the uncorrected top figure, the image comes into focus in front of the Myopia (nearsightedness). In the uncorrected top figure, the image comes into focus in front of the
Page from a copy of Nizami's Khamseh (Quintet) illustrating a princely country feast, Persian, ... Page from a copy of Nizami's Khamseh (Quintet) illustrating a princely country feast, Persian, ...
Antineutrophil cytoplasmic antibody staining patterns. Indirect immunofluorescence of ethanol-fixed ... Antineutrophil cytoplasmic antibody staining patterns. Indirect immunofluorescence of ethanol-fixed ...
Assessment of central venous pressure Assessment of central venous pressure
What is the current in Figure 16-1(b) if the diode is made of silicon and the polarity of the ... What is the current in Figure 16-1(b) if the diode is made of silicon and the polarity of the ...
Video: ADH and the arterioles, kidneys, sweat glands and the Atrial natriuretic peptide (ANP)

For a complete list of videos, visit our video library