exchange rate

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  • Created by: ishah
  • Created on: 09-05-13 18:44
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  • exchange rate
    • price of one currency in terms of another
    • floating exchange rate system
      • £ - market forces - S&D
    • appreciation
      • increase in exchange rate
        • imports cheaper exports expensive
    • depreciation
      • fall
        • exports cheaper
    • demand shift
      • interest rates
      • demand - imports - low - £
      • demand for exports
      • investment opp's
      • inflation rate
    • supply shift
      • desire to change £ -> other currencies
        • save
        • travel
        • buy overseas
    • PED M + X>1
      • current account
    • automatic stabiliser

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