Summary. A look at policies a country can consider to increase the value of a currency. Readers Question: I was wondering, what are some of the policies and possibilities a country can use to increase the value of their currency? Specifically, countries who would be trying to “overthrow” the US dollar like China, India, Brazil, …
Summary Education has positive benefits for the rest of society. If university education is left to market forces, there may be under-provision, and the economy may suffer from a lack of skilled graduates. Furthermore, in a free market, higher education would become the preserve of wealthy families who can afford to send their children to …
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An appreciation means an increase in the value of a currency against other foreign currency. An appreciation makes exports more expensive and imports cheaper. An example of an appreciation in the value of the Pound 2009 – 2012 Jan 2009 If £1 = €1.1 June 2012 £1 = €1.27 In this case, we can say …
Readers Question: how does a current account surplus affect domestic employment? A current account surplus means an economy is exporting a greater value of goods and services than it is importing. A country with a current account surplus will have a deficit on the financial/capital account. i.e. a country with a current account surplus will …
Definition: Money is an object used as a medium of exchange between two parties. It can have intrinsic value like gold or it can be a universally accepted instrument such as notes and coins printed by a Central Bank. Early money These gold coins are an example of money with an intrinsic value. Made out …
Currency substitution occurs when an economy uses an alternative currency to the domestic currency. The alternative currency maybe used in parallel to the domestic currency or some cases may completely replace it. Currency substitution can also be referred to as ‘dollarisation’ when the dollar is used. Examples of countries with official currency substitution include Ecuador …