Module Exchange Rate Policy KRUGMAN'S MACROECONOMICS for AP* 43 Margaret Ray and David Anderson.

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Module Exchange Rate Policy KRUGMAN'S MACROECONOMICS for AP* 43 Margaret Ray and David Anderson

Transcript of Module Exchange Rate Policy KRUGMAN'S MACROECONOMICS for AP* 43 Margaret Ray and David Anderson.

Page 1: Module Exchange Rate Policy KRUGMAN'S MACROECONOMICS for AP* 43 Margaret Ray and David Anderson.

ModuleExchangeRate Policy

KRUGMAN'SMACROECONOMICS for AP*

43

Margaret Ray and David Anderson

Page 2: Module Exchange Rate Policy KRUGMAN'S MACROECONOMICS for AP* 43 Margaret Ray and David Anderson.

What you will learnWhat you will learn

in thisin this ModuleModule::

• The difference between fixed exchange rates and floating exchange rates

• Considerations that lead countries to choose different exchange rate regimes

Page 3: Module Exchange Rate Policy KRUGMAN'S MACROECONOMICS for AP* 43 Margaret Ray and David Anderson.

Exchange Rate PolicyExchange Rate Policy

• Governments have more power to influence nominal exchange rates than other prices

• Exchange rates are important to countries where exports and imports are a large fraction of GDP

Page 4: Module Exchange Rate Policy KRUGMAN'S MACROECONOMICS for AP* 43 Margaret Ray and David Anderson.

Exchange Rate RegimesExchange Rate Regimes

•Exchange Rate Regime

•Fixed Exchange Rate

•Floating Exchange Rate

•"Managed" & "Target Zone"

Page 5: Module Exchange Rate Policy KRUGMAN'S MACROECONOMICS for AP* 43 Margaret Ray and David Anderson.

How Can an Exchange Rate BeHow Can an Exchange Rate Be Held Fixed? Held Fixed?

•Exchange Market Intervention

•Foreign Exchange Reserves

•Foreign Exchange Controls

Page 6: Module Exchange Rate Policy KRUGMAN'S MACROECONOMICS for AP* 43 Margaret Ray and David Anderson.

The Exchange Rate RegimeThe Exchange Rate Regime Dilemma Dilemma

•The Case for Fixed Exchange Rates

• Facilitates trade by creating certainty about the exchange rate

• Acts as a check on inflationary policies

Page 7: Module Exchange Rate Policy KRUGMAN'S MACROECONOMICS for AP* 43 Margaret Ray and David Anderson.

The Exchange Rate RegimeThe Exchange Rate Regime Dilemma Dilemma

•The Case against Fixed Exchange Rates

• Requires large foreign currency reserves

• May divert monetary policy

• Distorts incentives

• Opportunity for corruption


Module Supply and Demand: Supply and Equilibrium KRUGMAN'S MACROECONOMICS for AP* 6 Margaret Ray and David Anderson.

Module Supply and Demand: Supply and Equilibrium KRUGMAN'S MACROECONOMICS for AP* 6 Margaret Ray and David Anderson.

Module Monetary Policy and the Interest Rate KRUGMAN'S MACROECONOMICS for AP* 31 Margaret Ray and David Anderson.

Module Monetary Policy and the Interest Rate KRUGMAN'S MACROECONOMICS for AP* 31 Margaret Ray and David Anderson.

Module Supply and Demand: Changes in Equilibrium KRUGMAN'S MACROECONOMICS for AP* 7 Margaret Ray and David Anderson.

Module Supply and Demand: Changes in Equilibrium KRUGMAN'S MACROECONOMICS for AP* 7 Margaret Ray and David Anderson.

Module The Production Possibilities Curve Model KRUGMAN'S MACROECONOMICS for AP* 3 Margaret Ray and David Anderson.

Module The Production Possibilities Curve Model KRUGMAN'S MACROECONOMICS for AP* 3 Margaret Ray and David Anderson.

KRUGMAN'S MACROECONOMICS for AP* 29 Margaret Ray and David Anderson Module The Market for Loanable Funds.

KRUGMAN'S MACROECONOMICS for AP* 29 Margaret Ray and David Anderson Module The Market for Loanable Funds.

Module Aggregate Supply: Introduction and Determinants KRUGMAN'S MACROECONOMICS for AP* 18 Margaret Ray and David Anderson.

Module Aggregate Supply: Introduction and Determinants KRUGMAN'S MACROECONOMICS for AP* 18 Margaret Ray and David Anderson.

Module Comparative Advantage and Trade KRUGMAN'S MACROECONOMICS for AP* 4 Margaret Ray and David Anderson.

Module Comparative Advantage and Trade KRUGMAN'S MACROECONOMICS for AP* 4 Margaret Ray and David Anderson.

Module Inflation and Unemployment: The Phillips Curve KRUGMAN'S MACROECONOMICS for AP* 34 Margaret Ray and David Anderson.

Module Inflation and Unemployment: The Phillips Curve KRUGMAN'S MACROECONOMICS for AP* 34 Margaret Ray and David Anderson.

Introduction MACROECONOMICS MACROECONOMICS Dr. Nimantha Manamperi.

Introduction MACROECONOMICS MACROECONOMICS Dr. Nimantha Manamperi.

KRUGMAN'S MICROECONOMICS for AP* Introduction to Externalities Margaret Ray and David Anderson Econ: 74 Module.

KRUGMAN'S MICROECONOMICS for AP* Introduction to Externalities Margaret Ray and David Anderson Econ: 74 Module.

Module Interpreting Real Gross Domestic Product KRUGMAN'S MACROECONOMICS for AP* 11 Margaret Ray and David Anderson.

Module Interpreting Real Gross Domestic Product KRUGMAN'S MACROECONOMICS for AP* 11 Margaret Ray and David Anderson.

KRUGMAN'S MICROECONOMICS for AP* Introduction to Perfect Competition Margaret Ray and David Anderson Micro: Econ: 22 58 Module.

KRUGMAN'S MICROECONOMICS for AP* Introduction to Perfect Competition Margaret Ray and David Anderson Micro: Econ: 22 58 Module.

KRUGMAN'S MICROECONOMICS for AP* Introduction to Market Structure Margaret Ray and David Anderson Micro: Econ: 21 57 Module.

KRUGMAN'S MICROECONOMICS for AP* Introduction to Market Structure Margaret Ray and David Anderson Micro: Econ: 21 57 Module.

ECN202: Macroeconomics Introduction to Macroeconomics.

ECN202: Macroeconomics Introduction to Macroeconomics.

KRUGMAN'S MICROECONOMICS for AP* Externalities and Public Policy Margaret Ray and David Anderson Micro: Econ: 39 75 Module.

KRUGMAN'S MICROECONOMICS for AP* Externalities and Public Policy Margaret Ray and David Anderson Micro: Econ: 39 75 Module.

Module Saving, Investment, and the Financial System KRUGMAN'S MACROECONOMICS for AP* 22 Margaret Ray and David Anderson.

Module Saving, Investment, and the Financial System KRUGMAN'S MACROECONOMICS for AP* 22 Margaret Ray and David Anderson.

KRUGMAN'S MICROECONOMICS for AP* The Market for Labor Margaret Ray and David Anderson Micro: Econ: 35 71 Module.

KRUGMAN'S MICROECONOMICS for AP* The Market for Labor Margaret Ray and David Anderson Micro: Econ: 35 71 Module.

KRUGMAN'S MICROECONOMICS for AP* Introduction to Oligopoly Margaret Ray and David Anderson Econ: 64 Module.

KRUGMAN'S MICROECONOMICS for AP* Introduction to Oligopoly Margaret Ray and David Anderson Econ: 64 Module.

Pump Primer : Define the “Rule of 70.” 37. Module Long-run Economic Growth KRUGMAN'S MACROECONOMICS for AP* 37 Margaret Ray and David Anderson.

Pump Primer : Define the “Rule of 70.” 37. Module Long-run Economic Growth KRUGMAN'S MACROECONOMICS for AP* 37 Margaret Ray and David Anderson.

KRUGMAN'S MICROECONOMICS for AP* Other Elasticities Margaret Ray and David Anderson Micro: Econ: 12 48 Module.

KRUGMAN'S MICROECONOMICS for AP* Other Elasticities Margaret Ray and David Anderson Micro: Econ: 12 48 Module.