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Determinants of Supply and Demand for the Foreign Exchange Market by malj

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									                                                               Mrs. Scrivanich
                                                 Chapter 36 – Exchange Rates
Determinants of Supply and Demand for the Foreign Exchange Market
   State the Determinant
   Explain what will happen to supply and demand of EACH currency
   Show graph of country’s currency
   Determine the effect on the value of each currency
   Discuss how the situation will impact the balance of payments


  1. Japan buys more goods from the US




  2. The US FED raises the reserve ratio (compare to China)




  3. The US experiences more economic growth than Japan
                                                                Mrs. Scrivanich
                                                  Chapter 36 – Exchange Rates
4. France experiences a severe recession (compared to US)




5. US experiences deflation (compared to Italy)




6. The Swiss national bank adopts an Easy Money Policy (compare to US)
                                                             Mrs. Scrivanich
                                               Chapter 36 – Exchange Rates




7. The United States experiences inflation (compared to Japan)




8. US News report “Toys imported from China contain a percentage of lead
   paint”

								
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