Question: Is a world without inflation possible? What would be the implication of having a world without inflation? Justify Question Two (2) Below is the data

Is a world without inflation possible? What would be the implication of having a world without inflation? Justify

Question Two (2) Below is the data on market rates for the Zambian Kwacha per selected Foreign Currency per unit as at Thursday July 8, 2021. Daily ZMW/USD Exchange Rates : 08-07-2021 Time Buying Selling 09:30 22.6238 22.6735

View more Average Exchange rates: 01-07-2021 Currency Buying Selling

Daily ZMW/USD Exchange Rates : 08-07-2021

Time Buying Selling

USD 22.6181 22.6666

GBP 31.2469 31.3230

EUR 26.8635 26.9302

ZAR 1.5817 1.5867

Source: https://boz.zm/#:~:text=Inflation-,Market%20Rates,%C2%A0%C2%A0View%20more,-

Bank%20of%20Zambia [As at Thursday July 7, 2021]

Daily Commercial Banks Exchange Rates

08-07-2021 09:30 12:30

Bank Name Interbank Rates Retail Rates Interbank Rates Retail Rates

Buy Sell Buy Sell Buy Sell Buy Sell Sell

ACCESS BANK ZAMBIA 22.6320 22.6820 22.4250 22.8660 22.6365 22.6865 22.4250 22.8660

ATLAS MARA BANK 22.6275 22.6775 22.4235 22.8765 22.6300 22.6800 22.4235 22.8765

BANK OF CHINA (ZAMBIA) 22.6150 22.6650 22.4200 22.8600 22.6150 22.6650 22.4200 22.8600

ABSA BANK ZAMBIA 22.6200 22.6700 22.4412 22.8715 22.6200 22.6700 22.4412 22.8715

08-07-2021 09:30 12:30

Bank Name Interbank Rates Retail Rates Interbank Rates Retail Rates

CITIBANK ZAMBIA 22.6280 22.6780 22.4235 22.8765 22.6280 22.6780 22.4235 22.8765

ECOBANK ZAMBIA 22.6350 22.6800 22.4087 22.8614 22.6350 22.6800 22.4087 22.8614

FIRST ALLIANCE BANK ZAMBIA 22.6000 22.6500 22.4118 22.8600 22.6100 22.6600 22.4118 22.8600

FIRST CAPITAL BANK ZAMBIA 22.6320 22.6820 22.4029 22.8510 22.6330 22.6830 22.4029 22.8510

FIRST NATIONAL BANK ZAMBIA 22.6200 22.6700 22.4260 22.8640 22.6200 22.6700 22.4260 22.8640

INDO-ZAMBIA BANK 22.6200 22.6700 22.4100 22.8500 22.6200 22.6700 22.4100 22.8500

INVESTRUST BANK 22.6250 22.6750 22.3988 22.8513 22.6250 22.6750 22.3988 22.8513

STANBIC BANK ZAMBIA 22.6200 22.6700 22.4219 22.8681 22.6250 22.6750 22.4219 22.8681

STANDARD CHARTERED BANK 22.6200 22.6700 22.4170 22.8620 22.6250 22.6750 22.4170 22.8620

UNITED BANK FOR AFRICA ZAMBIA 22.6310 22.6810 22.4375 22.8625 22.6310 22.6810 22.4375 22.8625

ZAMBIA INDUSTRIAL COMMERCIAL BANK 22.6300 22.6800 22.4398 22.8702 22.6350 22.6850 22.4398 22.8702

ZAMBIA NATIONAL COMMERCIAL BANK 22.6250 22.6750 22.4468 22.8732 22.6250 22.6750 22.4468 22.8732

Market Average 22.6238 22.6735 22.4221 22.8640 22.6258 22.6755 22.4221 22.8640

Source: https://boz.zm/#:~:text=Daily%20Commercial%20Banks,BANK%20OF%20CHINA [As at Thursday

July 7, 2021]

Required:

(a) Is the Zambian Kwacha performing well or not? Justify

(b) What is the implication of the Zambian Kwacha's performance against convertible

currencies such as the US Dollar on managerial economic decisions?

(d) What would be the implication of bring the exchange rate to less than K10 against US$1?

Justify - What would be the implication of having a strong exchange rate against the US

Dollar and other convertible currencies on the Zambian economy

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