Macro Learning Objectives for questions over Exam 1 Form A

 

PCM

 ECON 2302 MICROECONOMICS   

Chapter 33

Below you will find the learning objective, concept, idea, term, or theory that each question on the exam will cover. Each number in the following list refers to the question number on Exam 4 that will test your knowledge of that specific learning objective. Each of these topics/learning objectives is discussed in the textbook in the order that they are listed below. A much better understanding can often be attained by working through MyEconLab assignments connected to any of these objectives.

 

    After reading Chapter 33, you should be able to:

    Balance of Payments and International Monetary Fund

  1. Know the difference between the balance of trade and the Balance of Payments. Define accounting identity and recognize surplus and deficit items.
  2. What kinds of transactions are contained in the Current and Capital accounts?
  3. What are Official Reserves? What impact will differing inflation rates have on trade? What is capital flight? 

    Determining Foreign Exchange Rates
  4. Know how a foreign exchange market functions and what is meant by the exchange rate, appreciation and depreciation.
  5. Be able to do exchange rate math, converting one currency into another or determining what the exchange rate is.
  6. What are the determinants of supply and demand and their slopes in foreign exchange markets? What causes the curves to shift?
  7. Put it all together and work with changes in equilibrium in the foreign exchange markets.

    Gold Standard and the International Monetary Fund
  8. Be familiar with the two historical fixed exchange rate systems, the gold standard and the Bretton Woods Monetary System and IMF.

    Fixed Versus Floating Exchange Rates
  9. Explain how a country can maintain a fixed exchange rate if that is its goal.
  10. Explain the pros and cons of a fixed exchange rate, and explain how a flexible exchange rate can work as a shock absorber.