Assume the following market as given below in the graph where S denotes the supply of...
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Assume the following market as given below in the graph where S denotes the supply of the currency and D denotes the demand for the currency and the point E denotes the current foreign exchange rate market. s(v.) X 9, 1, Suppose that US consumers demand more German cars. Explain and show graphically what happen to the equilibrium of the quantity Q of euros and to the exchange rate equilibrium S. 2. Suppose that the Europeans are not satisfied by the US policy of trade and decide to decrease their demand of US good. Explain and show graphically what happen to the demand and supply curves as well as to the equilibrium point E that is to the quantity Q of euros and to the exchange rate equilibrium S. 3. Suppose that both the US consumers demand more German cars and the Europeans demand less US goods at the same time. Explain and show graphically what happens to the supply and demand curves as well as to the equilibrium point E that is to the quantity Q of euros and to the exchange rate equilibrium S. Assume the following market as given below in the graph where S denotes the supply of the currency and D denotes the demand for the currency and the point E denotes the current foreign exchange rate market. s(v.) X 9, 1, Suppose that US consumers demand more German cars. Explain and show graphically what happen to the equilibrium of the quantity Q of euros and to the exchange rate equilibrium S. 2. Suppose that the Europeans are not satisfied by the US policy of trade and decide to decrease their demand of US good. Explain and show graphically what happen to the demand and supply curves as well as to the equilibrium point E that is to the quantity Q of euros and to the exchange rate equilibrium S. 3. Suppose that both the US consumers demand more German cars and the Europeans demand less US goods at the same time. Explain and show graphically what happens to the supply and demand curves as well as to the equilibrium point E that is to the quantity Q of euros and to the exchange rate equilibrium S.
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Answer rating: 100% (QA)
1 If US consumers demand more German cars it would increase the demand for euros because they need euros to purchase the cars This increase in demand ... View the full answer
Related Book For
Income Tax Fundamentals 2013
ISBN: 9781285586618
31st Edition
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
Posted Date:
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