ch15Exchange-Rate Adjustments and the Balance of Payments(国际经济学-浙江林学院,岑丽娟).pptVIP

Carbaugh, Chap. 15 International EconomicsBy Robert J. Carbaugh8th Edition Chapter 15: Exchange-Rate Adjustments and the Balance of Payments Exchange-rate adjustment and the BOP Automatic mechanisms may restore balance-of-payments equilibrium, but at the cost of recession or inflation As an alternative, governments allow exchange rates to change Floating exchange rates, determined by markets Devaluing or revaluing fixed exchange rates Exchange rate effects on costs prices Impact of appreciation or depreciation on costs depends on the proportion of inputs priced in foreign vs. domestic curre