Instructor
Caris Liew
Description
In this chapter you will learn how to:
- define the meaning of an exchange rate
- explain how a floating exchange rate is determined
- explain the difference between depreciation and appreciation of a floating exchange rate
- analyse the causes of changes in a floating exchange rate
- discuss, using AD/AS analysis, the impact of exchange rat
- changes on the domestic economy’s equilibrium national income and the level of real output, the price level and employment.
Curriculum
6.4.1 Definition of exchange rate
6.4.2 Determination of a floating foreign exchange rate
6.4.3 Distinction between depreciation and appreciation of a floating exchange rate
6.4.4 Causes of changes in a floating exchange rate: demand and supply of the currency
6.4.5 AD/AS analysis of the impact of exchange rate changes on the domestic economy
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