# economics

posted by .

The Australian dollar is currently very high, with a value of US$0.80. Many people expect the Australian dollar to rise even higher by the end of the year, to as much as US$0.90.
Use a ¡°FOREX¡± (foreign exchange market) diagram to show the impact of this expectation on the Australian dollar. In your answer you must explain the effect of this expectation on the money supply (MS), the holdings of the Reserve Bank of Australia (the Central Bank) of gold and foreign exchange, the Current Account and
Capital Account balances, and on Australia¡¯s overall Balance of Payments. For convenience you can assume that the current account is in deficit and the capital account is in surplus.

Do some research, then take a shot. What do you think?

## Similar Questions

1. ### Economcis

I have an assignment on the the factors which impact the Australian dollar. "How does the government influence the value of the Australian dollar?
2. ### economics

What effects will this change have on the exchange rate of the canadian dollar in terms of the us dollar?
3. ### ECONOMICS

T OR F A rise in Canadian interest rates will boost the dollar's exchange value, reducing domestic price levels.
4. ### statistics

Let x be a random variable representing dividend yield of Australian bank stocks. We may assume that x has a normal distribution with sigma =2.3%. A random sample of 17 Australian bank stocks has a sample mean of x bar 7.74%. For the …
5. ### statistics

Let x be a random variable representing dividend yield of Australian bank stocks. We may assume that x has a normal distribution with A random sample of 17 Australian bank stocks has a sample mean of For the entire Australian stock …
6. ### Statistics

4. Let X be a random variable representing dividend yield of Australian bank stocks. We may assume that x has a normal distribution with A random sample of 19 Australian bank stocks has a sample mean of For the entire Australian stock …
7. ### Statstics

Let x be a random variable representing dividend yield of Australian bank stocks. We may assume that x has a normal distribution with \alpha =2.3% A random sample of 18 Australian bank stocks has a sample mean of x bar = 6.1%. For …
8. ### Exchange Rates Help

Hello, How do you know if the Canadian dollar is rising or falling relative to the US dollar?
9. ### Math

A box contains a one-dollar bill, a five-dollar bill, a ten-dollar bill, and a twenty-dollar bill. Two bills are chosen in succession without replacement. Use a tree diagram to list the sample space for this experiment and then answer …
10. ### Math

The exchange rate from US dollars (USD) to euros (EUR) is given by 1 USD = 0.753 EUR. Give the answers to the following correct to two decimal places. Roger receives 800 Australian dollars (AUD) for 610 EUR. Calculate the value of …

More Similar Questions