MGCR 382 Lecture Notes - Lecture 10: Trilemma, Free Trade, Big Country
13 Feb 2015
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Mgcr 382- international business lecture 10- trade, exchange rate and the international monetary system. Increases demand for currency: gold exchanges at the bank of england, price level in uk, exports more expensive. Initially canada increases their demand for gold to pay for uk imports. Less demand lower prices: making canada more attractive to exporters. Floating rates bop adjusts via exchange rates movements. Fixed rates adjustments via inflation or deflation (happens within the country) Was held in order to resolve the desire for return to a manually cooperative and stable international monetary system. There were two organizations created, the imf (international monetary fund) and the. Main roles of the imf: keep an eye on the band width of 1% on exchange rates are given to countries, an emergency loan facility was created if one of the members find themselves in a troublesome situation.
