TAILIEUCHUNG - Microeconomics for MBAs 60

Microeconomics for MBAs 60. The Economic Way of Thinking for Managers. Microeconomics for MBAs develops the economic way of thinking through problems that MBA students will find relevant to their career goals. Maths is kept simple and the theory is illustrated with real-life scenarios | Chapter 17 International Trade and Finance 25 Market Adjustment to Changes in Money Market Conditions By modifying exchange rates to correct for imbalances in payments the money market can accommodate vast changes in the economic conditions of nations engaged in trade. A good example is the way the market handles a change in consumption patterns. These changes in consumption and hence in foreign exchange rates can be caused by changes in a nation s tastes and preferences real income level of prices including interest rates costs and expectations as to future exchange rates. If all countries exchange rates move with the relative rates of inflation only real terms of trade changes would affect the relative prices of home country to foreign-country goods. However while floating exchange rates tend to eliminate automatically any balance-of-payment problems they may diminish the volume of trade because of the uncertainty and instability of the terms of trade. In fact since flexible exchange rates were reintroduced in 1971 the volume of world trade has actually grown despite considerable volatility and turbulence. The two major advantages of a floating system are that exchange rates are automatically determined exclusively by free market forces without government intervention controls or regulations. Moreover external adjustment under favorable conditions is attained without requiring major domestic or internal price income or employment changes. Its two major disadvantages are 1 uncertainty and instability in the form of frequent and large fluctuations discourages international trade transactions and investment and 2 there is the possibility of exchange rate fluctuations leading to cumulative disequilibrium rather than stable equilibrium. Suppose American preferences for French goods say wines and perfumes increase for some reason. The demand for francs will rise because Americans will need more francs to buy the additional French goods they desire. If as in Figure

• Kinh tế học
• Kinh tế vi mô
• cao học
• The Economic Way of Thinking
• Competitive Product Markets
• Principles of Rational Behavior
• Society and Business
• trắc nghiệm kinh tế vi mô
• đề thi kinh tế vi mô
• bài tập kinh tế vi mô
• tài liệu kinh tế vi mô
• giáo trình kinh tế vi mô
• bài giảng kinh tế vi mô
• Ôn tập kinh tế vi mô
• Kinh tế vĩ mô
• bài tập kinh tế vĩ mô
• trắc nghiệm kinh tế vĩ mô
• đề thi kinh tế vĩ mô
• tài liệu kinh tế vĩ mô
• bài giảng kinh tế vĩ mô
• giáo trình kinh tế vĩ mô
• Các mô hình kinh tế
• Mô hình kinh tế
• Kinh tế học vi mô
• Kinh tế học
• Nhập môn kinh tế học
• Tổng quan kinh tế học vi mô
• Bài tập kinh tế học vi mô
• Ứng dụng kinh tế vi mô
• Bài tập môn kinh tế vi mô
• Bài tập thực hành kinh tế vi mô