+1-415-315-9853

info@mywordsolution.com

Economics

 Basic Economics Macroeconomics Microeconomics Business Economics Econometrics International Economics Managerial Economics Game Theory Public Economics

Analytical Problems for each of the given problems:

problem 1: A U.S. resident can earn 6% interest on a one-year bank deposit of \$100,000 at home. Alternatively, she can transform the \$100,000 into German marks and earn 4% on a one-year bank deposit in Germany. The initial exchange rate is 1.5 DM/US\$.

a. Assume that she wishes to withdraw her money at the end of the year. If the exchange rate changes to 1.45DM/US\$ at the end of the year, which deposit will give the U.S. resident a higher return? By how much (measured in U.S. dollars)?

b. At the end of the year, our U.S. investor wishes to travel to Ireland to visit the relatives. She sees that the IR£/US\$ exchange rate is 0.91IR£/1\$ and the IR£/DM exchange rate is 0.40IR£/1DM and the DM/\$ conversion is 1.45DM/US\$. Should she convert the \$10,000 she wishes to take to Ireland directly from US\$ to IR£, or should she first convert to DM and then to IR£? How much does (in US\$) she make/lose by converting to DM first?

problem 2: Japan can make cars for \$12,000 each; the US can make them for \$16,000, and Mexico can make them for a cost of \$20,000 each. In the problems below you are asked about the effects on the Mexican economy of a free trade agreement with the United States. Suppose that Mexican consumers will buy 1 million cars per year if the price is \$20,000 and that every \$1,000 drop in the price produces an additional purchase of 100,000 cars.

a. Before the free trade agreement, Mexico had a tariff on cars equal to \$10,00 per car. What was the price of cars in Mexico before the FTA?

b. Mexico signs the FTA with the United States however retains the tariff of \$10,000 on Japanese cars. What will the price of cars be in Mexico now?

c. What is the amount of trade diversion and trade creation caused by the FTA? Show this graphically and also numerically.

d. What is the change in Mexico’s economic welfare in going from the condition in (a) to that in (b)?

International Economics, Economics

• Category:- International Economics
• Reference No.:- M94835

Have any Question?

Related Questions in International Economics

Projectfor this project you need to analyze and compare the

Project For this project you need to analyze and compare the main economic indicators for 2 countries. The main indicators are listed below and you are to explain what causes each of the indicators to behave in a certain ...

Assignmentexamples of domestic and international terrorist

Assignment Examples of domestic and international terrorist groups and networks: • HAMAS • IRA • PKK • KKK • ETA • Hezbollah • Aum Shinrikyo Note: You may choose any terrorist organization or network that you would like. ...

Assignmentsuppose that there are two products clothing and

Assignment Suppose that there are two products: clothing and soda. Both Brazil and the United States produce each product. Brazil can produce 100,000 units of clothing per year and 50,000 cans of soda. The United States ...

Assignmentaccording to theorist karen horney these 10

Assignment According to theorist Karen Horney, these 10 neurotic needs can be classed into three broad categories: Category 1: Moving Towards People (Compliant)-Need for affection and approval-Need for a powerful partner ...

Economics problem seta suppose the united states can

Economics Problem Set A) Suppose the United States can produce 20 tons of FOOD or 8 TRACTORS, and suppose Japan can produce 10 tons of FOOD or 3 TRACTORS. B) What is the opportunity cost of producing tractors in the Unit ...

International economics 7 calculation questionsplease show

International Economics, 7 Calculation Questions Please show the full calculation. Type or pictures of your handwriting are fine! 1. Consider the following data on August 1, 2016 (annual) interest rates US: 0.3% Brazil: ...

Assignment global economy national economies and

Assignment: Global Economy, National Economies, and Competition In the first part of the twenty-first century a great recession struck most of the countries in the world. The next decade has been severally impacted with ...

Economics assignmentpart i1 assume the united nations

Economics Assignment PART I 1. Assume the United Nations Educational, Scientific, and Cultural Organization (UNESCO) hired you as an economic development expert. Your mission is to travel to several developing countries ...

Essay should be based on one of the problems mentioned into

Essay should be based on one of the problems mentioned into Haberler (1950) with references to the main assumptions of the general equilibrium analysis

Consider a model of two stylized countries called germany

Consider a model of two stylized countries, called Germany and China. Germany is an advanced economy with a long tradition of manufacturing highquality goods. China is less developed, but has become the world's secondlar ...

• 13,132 Experts

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

WalMart Identification of theory and critical discussion

Drawing on the prescribed text and/or relevant academic literature, produce a paper which discusses the nature of group

Section onea in an atwood machine suppose two objects of

SECTION ONE (a) In an Atwood Machine, suppose two objects of unequal mass are hung vertically over a frictionless

Part 1you work in hr for a company that operates a factory

Part 1: You work in HR for a company that operates a factory manufacturing fiberglass. There are several hundred empl

Details on advanced accounting paperthis paper is intended

DETAILS ON ADVANCED ACCOUNTING PAPER This paper is intended for students to apply the theoretical knowledge around ac

Create a provider database and related reports and queries

Create a provider database and related reports and queries to capture contact information for potential PC component pro