In this lesson, our instructor Jibin Park gives an introduction on foreign exchange market. He discusses exchange rates, the foreign exchange market, inflation and real exchange rates, inflation and real exchange rates, purchasing power parity, burgernomics, floating vs. fixed exchange rate regime, and exchange rate dilemma.
Stuff produced in a country will be paid for in that country’s currency
An appreciating currency will decrease exports and thus decrease GDP
A depreciating currency will increase exports and thus increase GDP
The real exchange rate takes into account inflation in both countries
Purchasing Power Parity is the nominal exchange rate at which a given basket of goods and services would cost in each country
The Big Mac Index is a simplistic but effective way of measuring purchasing power parity
A fixed exchange rate occurs when the government keeps the exchange rate against some other currency at or near a particular target
A floating exchange rate occurs when the exchange rate is wherever the free market takes it
Foreign Exchange Market
Lecture Slides are screen-captured images of important points in the lecture. Students can download and print out these lecture slide images to do practice problems as well as take notes while watching the lecture.
This book created a 5-step plan to help you study more effectively, use your preparation time wisely, and get your best score. This book includes two full-length practice exams modeled on the real test, all the terms and concepts you need to know to get your best score, and your choice of three customized study schedules.
This book includes an in-depth preparation for both AP economics exams. It features two full-length practice tests, one in Microeconomics and one in Macroeconomics, and all test questions answered and explained. It also features a detailed review of all test topics, which include: supply and demand, theory of consumer choice, economics in the public sector, costs, perfect and imperfect competition, monopolies, labor resources, game theory, the national income and gross domestic product, inflation and unemployment, fiscal policy, money and banking, monetary policy, economic growth, international trade and exchange, interest rate determination, and the market for loanable funds.