MGM101H5 Lecture Notes - Lecture 6: Purchasing Power Parity, Devaluation, Gross Domestic Product

• School: UTM
• Department: Management
• Course: MGM101H5
• Professor: Dave Swanston

Document Summary

Certain industries are increasing; some are decreasing. We want to know the potential of the market (ex. Consider the other environment condition, ie. us market is growing, canadian dollars is lower (maybe 0. 9 is lower than expectation) Comparing with other countries growth rate, to determine if 0. 9 growth is good or (cid:374)ot, (cid:272)o(cid:373)pari(cid:374)g (cid:449)ith the pre(cid:448)ious (cid:455)ear"s" gro(cid:449)th data. Bank of canada, rising the interest, will reduce investments, vice versa. Its fundamental responsibility is to develop and manage the monetary policies and fi(cid:374)a(cid:374)(cid:272)ial s(cid:455)ste(cid:373)s asso(cid:272)iated (cid:449)ith ca(cid:374)ada"s e(cid:272)o(cid:374)o(cid:373)i(cid:272) a(cid:272)ti(cid:448)it(cid:455) Has the following core areas of responsibility. Developing and managing financial systems and safeguards. Providing fund management services to chartered banks. Interest rate adjustment is its primary weapon in controlling inflationary pressures in the short term. Because the banks are so big and stable, they become a strong foundation to. If the(cid:455) raise the i(cid:374)terest rate, the(cid:455) i(cid:374)(cid:272)rease (cid:862)(cid:271)usi(cid:374)ess (cid:271)ori(cid:374)g(cid:863) a(cid:272)ti(cid:448)ities. If they lower the interest rate, they increase economic activity.