| find_someone_who_.docx |
As a way of recapping some content from Year 12 complete the "Find Someone Who..." activity below. Extra credit for the most interesting and exotic answers!!
A summary of the achievements of Economics students in the Class of 2018 and key dates for the Class of 2019
4.B.EXCHANGE RATES AND THE BALANCE OF PAYMENTS
4BA: eXCHANGE rATES:
- Explain how the value of an exchange rate in a floating system is determined by the demand for, and supply of, a currency.
- Draw a diagram to show the determination of exchange rates in a floating exchange rate system.
- Calculate the value of one currency in terms of another currency.
- Calculate the exchange rate for linear demand and supply functions.
- Plot demand and supply curves for a currency from linear functions and identify the equilibrium exchange rate.
- Using exchange rates, calculate the price of a good in different currencies.
- Explain the factors that lead to changes in currency demand and supply.
- Distinguish between a depreciation of the currency and an appreciation of the currency.
- Draw diagrams to show changes in the demand for, and supply of, a currency.
- Calculate the changes in the value of a currency from a set of data.
- Evaluate the possible economic consequences of a change in the value of currency.
- Describe a fixed exchange rate system involving commitment to a single fixed rate.
- Distinguish between a devaluation of the currency and a revaluation of the currency.
- Explain, using a diagram, how a fixed exchange rate is maintained.
- Explain how a managed exchange rate operates.
- Examine the possible consequences of overvalued and undervalued currencies.
- Compare and contrast a fixed exchange rate system with a floating exchange rate system.
|
why: PROBLEMS ARISE IN THE CONTEXT OF INTERNATIONAL MONETARY FLOWS THAT AFFECT A COUNTRIES ECONOMIC FORTUNES
|
- $2.383 trillion in foreign exchange swaps per day!!!!!!
Lesson 1: Exchange rATE DETERMINATION
Key IDEA:
The demand for foreign currencies generates a supply of domestic currency; and demand for domestic currency generates a supply of foreign currencies, In a simple two-currency example using pounds and yen, it follows that:
Demand for pounds = Supply of yen
Demand for yen = Supply of pounds
|
INSTRUCTIONAL VIDEOS
|
|
7. Speculation
|
Summary of the causes of changes in exchange rates:
- Foreign demand for a countries exports
- Domestic demand for imports
- Relative interest rate changes
- Relative rates of inflation
- Investment from abroad
- Changes in income
- Speculation
- Use of foreign currency reserves
|
exchange rate simulation: |
CONCEPTS:
- Exchange rates
- Money
- Markets
- Supply
- Demand
- Currency exchange
- Floating exchange rates
- Demand
- Supply
- Market clearing price
- Transaction cost
| key_points_-_exchange_rate_determination.docx |
|
|
|
|
Home Learning:
Either/and
Complete notes 381 to 386 in tragakes
Complete questions 1 to 17 below
| 3.2_-_exchange_rates.docx |
| what_explains_changes_in_currencies.docx |
| brazilian_case_study.docx |
| exchange_rates_-_consequences_only.docx |
Paper 1 - Part a qUESTION |
With the aid of a diagram explain 2 causes of a change in the exchange rate of a country's currency (10 marks)
Complete the Part a question from Paper 1 above. It should take you no more than 25 minutes. When you have completed this ask your teacher for the answer key and mark scheme.
Complete the Part a question from Paper 1 above. It should take you no more than 25 minutes. When you have completed this ask your teacher for the answer key and mark scheme.
|
Floating, Fixed, pegged and managed float |
How: Develop understanding of the advantages and disadvantages of each system by looking at these systems of exchange.
Why: The exchange rate system is a key determinant of monetary flows and wealth in the global economy.
Why: The exchange rate system is a key determinant of monetary flows and wealth in the global economy.
|
|
| fixed_managed_or_floating.docx |
|
Explaining changes in the foreign exchange markets: Using Prezi Video explain how:
The value of a currency is maintained in a floating exchange rate system What causes a currency appreciation and depreciation Use the scenarios above to explain how currency values are maintained in a fixed exchange rate (at least 3) What are the pros and cons of an undervalued exchange rate and an overvalued exchange rate? What are the pros and cons of the floating, managed and fixed exchange rate system? ENSURE THAT YOUR PRESENTATION CONTAINS DIAGRAMS DEMONSTRATING CHANGE, MAKE SURE YOU EXPLAIN WHY! |
Year 13 Group 3 Films
|
Finlay, Kieran, Lars
Batyr, Henry - Part 1
|
Batyr, Henry - Part 2
\
|
Year 13 Group 6 Films
|
|
|
aCTIVITY 1: reflecting on the simulation
Go back to the discussion forums that contain our driving questions, reflect on the forum below or another suitable question and write down the key understandings that you gained from the simulation:
"How much harmonization is desirable"
|
|
|
| the_history_of_currency_exchange_and_the_issue_of_fixed_vs_floating.docx |
|
|
|
|
|
Balance of payments |
You should be able to:
- Outline the role of the balance of payments.
- Distinguish between debit items and credit items in the balance of payments.
- Explain the four components of the current account.
- Distinguish between a current account deficit and a current account surplus.
- Explain the two components of the capital account.
- Explain the three main components of the financial account.
- Calculate elements of the balance of payments from a set of data.
- Explain how the current account balance is equal to the sum of the capital account and financial account balances.
- Examine how the current account and the financial account are interdependent.
- Explain why a deficit in the current account of the balance of payments may result in downward pressure on the exchange rate of the currency.
- Discuss the implications of a persistent current account deficit.
- Explain the methods that a government can use to correct a persistent current account deficit.
- Evaluate the effectiveness of the policies to correct a persistent current account deficit.
- State the Marshall–Lerner condition.
- Apply the Marshall–Lerner condition to the effect of devaluation/depreciation on the current account.
- Explain the J-curve effect, with reference to the Marshall–Lerner condition.
- Explain why a surplus in the current account of the balance of payments may result in upward pressure on the exchange rate of the currency.
- Discuss the possible consequences of a rising current account surplus.
|
|
|
| bop_textbook_section.pdf |
|
|
|
| 3.3_balance_of_payments__1_.pdf |
| usa_bop.docx |
Balance of payments - Office for National Statistics
All economic transactions between residents of the UK and the rest of the world.
| uk_balance_of_payments_the_pink_book_2018.pdf |
|
|
|
|
|
Exchange rates student presentations: |
|
|
|