« previous next »

Author Question: What is an overvalued exchange rate? What factors may cause a country's currency to become ... (Read 74 times)

nevelica

  • Hero Member
  • *****
  • Posts: 563
on: Jun 30, 2018
What is an overvalued exchange rate? What factors may cause a country's currency to become overvalued?
 
  What will be an ideal response?

Question 2

Government regulations that worsen the performance of financial institutions include:
 
  a. interest rate ceilings
  b. reserving a minimum portion of loans for rural borrowers
  c. a high percentage of deposits kept in reserve
  d. subsidies for low-income borrowers
  e. all of the above


Expo

  • Sr. Member
  • ****
  • Posts: 351
Reply #1 on: Jun 30, 2018
Answer to Question 1

The value of the domestic currency is greater than its value at the equilibrium point
in the foreign exchange market. One likely reason why currencies become overvalued
is the insistence of the central bank in maintaining fixed exchange rates in the face of substantial domestic inflation.

Answer to Question 2

E


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
« previous next »
 

Did you know?

It is important to read food labels and choose foods with low cholesterol and saturated trans fat. You should limit saturated fat to no higher than 6% of daily calories.

Did you know?

Earwax has antimicrobial properties that reduce the viability of bacteria and fungus in the human ear.

Did you know?

Oxytocin is recommended only for pregnancies that have a medical reason for inducing labor (such as eclampsia) and is not recommended for elective procedures or for making the birthing process more convenient.

Did you know?

There are over 65,000 known species of protozoa. About 10,000 species are parasitic.

Did you know?

Amphetamine poisoning can cause intravascular coagulation, circulatory collapse, rhabdomyolysis, ischemic colitis, acute psychosis, hyperthermia, respiratory distress syndrome, and pericarditis.

Changes in the abundance and egg-hatching success rate of prairie chickens. Changes in the abundance and egg-hatching success rate of prairie chickens.
Structures of four common types of DNA-binding motifs from eukaryotic transcription factors Structures of four common types of DNA-binding motifs from eukaryotic transcription factors
How much the temperature will rise depends on many factors that affect the level of GHG emission How much the temperature will rise depends on many factors that affect the level of GHG emission
Factors Affecting the Affinity of Hb for O2 Factors Affecting the Affinity of Hb for O2
The radius of the Sun is 6.95 × 108 m. It radiates heat at the rate of 5.32 x 10 The radius of the Sun is 6.95 × 108 m. It radiates heat at the rate of 5.32 x 10
Determine the nominal annual rate of interest of the following ordinary general annuity. Determine the nominal annual rate of interest of the following ordinary general annuity.
Video: Hydrogen bonds - role in the body

For a complete list of videos, visit our video library