ECS3703 Assignment 2 Semester 1 2024 ... 100 % TRUSTED workings, explanations and solutions. For assistance call or W.h.a.t.s.a.p.p us on +/ 2/ 5/ 4 /7 /7 /9 /5 /4 /0 /1 /3 /2 .
Assignment 02 (semester 1)
THIS ASSIGNMENT IS COMPULSORY. THE MARKS YOU OBTAIN FOR IT
WILL, CONTRIBUTE TO YOUR SEME...
, Assignment 02 (semester 1)
THIS ASSIGNMENT IS COMPULSORY. THE MARKS YOU OBTAIN FOR IT
WILL, CONTRIBUTE TO YOUR SEMESTER MARK, AND HAVA A WEIGHT OF
60%. NO EXTENSION FOR THE SUBMISSION OF THIS ASSIGNMENT CAN BE
CONSIDERED.
Assignment 2
Question 1[25]
Assume Nation A operates under a flexible exchange rate system, the principle of
imperfect capital mobility, and desires to achieve both the internal and external balance.
(a) Which macroeconomic policy should Nation A use to simultaneously
achieve internal and external balance and why? ………………….………(7)
(b) With the aid of a diagram, briefly explain how Nation A can use the policy
mentioned in (a) to achieve the internal and external balance…………...(18)
Question 2 [10]
Discuss each of the following arrangements, and explain the difference [10]
(a) a fixed exchange rate system………………………………………………(3)
(b) a currency board arrangement………………...…………………………..(4)
(c) dollarization………………………………………………………………….(3)
Question 3 [15]
With the aid of a diagram, explain the effect of trade balance changes on aggregate
demand in an open economy with flexible exchange rates.
Open Rubric
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through EFT, credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying this summary from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller LIBRARYpro. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy this summary for R51,78. You're not tied to anything after your purchase.