The Portfolio Balance model.

The Portfolio Balance model a.) The portfolio balance approach is an extended version of the monetary exchange rate models that focus on the impact of the bond. According to the portfolio balance approach, any changes in the economy of a country will impact directly the demand and supply for domestic and foreign bonds. The money… Continue reading The Portfolio Balance model.

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Macroeconomics an aspect of economics.

Macroeconomics Macroeconomics is an aspect of economics that assesses the performance of an economy by addressing issues such as unemployment, inflation, and the gross domestic product. All students undertaking business-related courses have to study this topic at their higher education levels. This paper outlines a personal reflection on understanding macroeconomics. Since the start of the… Continue reading Macroeconomics an aspect of economics.

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Mundell-Fleming and fiscal policies.

Mundell-Fleming and fiscal policies. The finance minister embarking on an austerity programme would mean that the government would some stringent economic measures to reduce public spending. Reducing the public expenditure would affect both the floating exchange rate and fixed exchange rates. The floating exchange rate determined by the forex would be negatively affected due to… Continue reading Mundell-Fleming and fiscal policies.

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Home Country Bias summary.

Question 1 a.)Home Country Bias Today in the entrepreneurial world, suitable investments can be distinguished from bad investments in terms of their financial outcomes. Financial growth in a business can be achieved by having a strong understanding of the strategies required in making exemplary investment decisions. In making investment decisions, a home-country bias might arise… Continue reading Home Country Bias summary.

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The Mundell-Fleming model.

The Mundell-Fleming model The Mundell-Fleming model is an economic model brought forward by Robert Mundell and Marcus Fleming. The model depicts the short-run relationship between an economy’s interest rate, nominal exchange rate, and output. The model suggests that an economy cannot simultaneously maintain a free capital movement, independent monetary policy, and a fixed exchange rate.… Continue reading The Mundell-Fleming model.

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