Sell exports and buy imports
Build factories or store in other markets
Hold currencies in bank accounts for future imports, exports or business loans
Speculate on currency values
Control excessive imbalances.
Saturday, May 16, 2015
Unit 7 Notes: 4.27.2015
Purchasing Power Parity: NEED
Ex: if the dollar to the euro is a $1.50 / 1€ then each dollar fifty will buy 1 euro. However if an item in the US cost a dollar fifty and cost more or less than 1€ than the parity is lost. Markets will adjust quickly and floating rates or pressure for change will occur for fixed rates.
Invest in other countries.
Sell exports and buy imports
Build factories or store in other markets
Hold currencies in bank accounts for future imports, exports or business loans
Speculate on currency values
Control excessive imbalances.
Sell exports and buy imports
Build factories or store in other markets
Hold currencies in bank accounts for future imports, exports or business loans
Speculate on currency values
Control excessive imbalances.
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