4.6 Exchange Rates

Fixed exchange rates NONE YET
Floating exchange rates NONE YET
Managed exchange rates NONE YET

Distinction between
• depreciation and devaluation
• appreciation and revaluation


Effects on exchange rates of
• trade flow
• capital flows/interest rate changes
• inflation
• speculation
• use of foreign currency reserves


Relative advantages and disadvantages of fixed and floating rates Higher level extension topic NONE YET

Advantages and disadvantages of single currencies/monetary integration Higher level extension topic NONE YET
Purchasing power parity theory (PPP) Higher level extension topic http://opengecko.com/economics/purchasing-power-parity/
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