Total of 7 questions.CH 11 - Q 8, 9, 10, 11.CH 12 - Q 1, 2, 3.You should have the book link with the...

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Total of 7 questions.CH 11 - Q 8, 9, 10, 11.CH 12 - Q 1, 2, 3.You should have the book link with the username and password for reference.

Komalavalli · Accepted Answer

Chapter - 11
8.
Stable speculation happens when the participation of speculators alters price movements and the magnitude of price fluctuation is constrained. For example, if the price lowers, corporations would reduce supply in response to the price decline (the company does not want to sell low and hopes that the price will increase). Prices rise as a result of the lower supply. We achieve a different conclusion when we use destabilizing conjecture. In this situation, speculators respond to the price movement because they believe it represents a long-term trend. When the price of a product is first reduced, more firms sell the thing, and demand falls more. Price changes are amplified when speculation destabilizes the market.
9. The change in exchange rate depicts the appreciation of dollar, for pound deprecation of euro. New exchange rate depicts the deprecation of dollar.
10. Forex arbitrage is a trading method that takes advantage of price disparities in the foreign currency market. Arbitrage may be done in a number of methods, but the goal is to purchase and sell currency values that are currently diverging but are very likely to converge rapidly. People can buy euro in newyork and sell it in London in order to arbitrage.
11.a.$1.50 per pound.
Quantities of pounds purchased is 30.it cost around $1.50.
b.supply, a decrease , a decrease, an increase.
c.a decrease, demand, an increase, decrease.
Chapter 12
1. Fundamentals of the market and market expectations Factors such as real income differentials, inflation rate differentials,

Total of 7 questions. CH 11 - Q 8, 9, 10, 11. CH 12 - Q 1, 2, 3. You should have the book link with the username and password for reference.

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