Understanding Exchange Rates
Markets in which the currencies of different countries are traded for one another.
What are foreign-exchange rates markets?
When a country's exchange rate appreciates, residents of this country find that the price of imported goods is this.
China's remarkable economic growth has been due in part to its success in this.
What are export markets?
The European Union created a currency area that covered this many countries.
What is 11?
An increase in value of one country's country's compared to another country's currency.
What is appreciation?
Because the exchange rates affect patterns of trade, uncertainty about them increases the risk of these three economic agents.
From 2005 to 2008 the China allowed the Yuan to gradually do this.
What is appreciate?
These two countries use the American dollar.
What is Ecuador and Panama?
A decrease in value of one country's currency in terms of another country's currency.
What is depreciation?
Countries like Argentina, Brazil, Israel, Russia, and Bulgaria used exchange rate targeting as a way to control this.
What is inflation?
In 2008, out of fear of slowing its exports, China did this to the Yuan exchange rate.
What is fixed?
Suaziland and Lesotho use this South African currency.
What is the rand?
A weighted average of the exchange rate of a country's currency relative to those of all trading partners.
What is the real effective exchange rate?
What is a currency union?
The Yuan's REER has appreciated much more strongly than the nominal bilateral rate against the dollar. Part of the reason has to do with this.
What is inflation?
California, although a member of the union stayed with this system when the government in Washington D.C. began issuing a new paper currency.
What is the gold standard?
A situation in which goods cost the same in one country as in another when prices are compared using the market exchange rate.
What is purchasing power parity?
Purchase of foreign assets are an instrument of expansionary policy serve to do this.
What is increase bank reserves?
China wanted to persuade the IMF to admit the Yuan to this elite status.
What is "reserve currency"?
If several countries tend to trade with one another frequently, this is a strong argument for adopting this.
What is a currency area?