Mgmt 425 Ch 10

intentionally lowering the value of a nation's currency

intentionally raising the value of a nation's currency

principe that an identical item must have an identical price in all countries when the price is expressed in a common currency

principle that the nominal interest rate is the sum of the real interest rate and the expected rate of inflation over a specific period

principle that a difference in nominal interest rates supported by two countries' currencies will cause an equal but opposite change in their spot exchange rates

view that prices of financial instruments reflect all publicly available information at any given time

view that prices of financial instruments do not reflect all publicly available information

technique that uses statistical models based on fundamental economic indicators to forecast exchange rates

technique that uses charts of past trends in currency prices and other factors to forecast exchange rates

collection of agreements and institutions that govern exchange rates

international monetary system in which nations link the value of their paper currencies to specific values of gold

system in which the exchange rate for converting on currency into another is fixed by international agreement

agreement (1944) among nations to create a new international monetary system based on the value of the U.S. dollar

economic condition in which a trade deficit causes a permanent negative shift in a country's balance of payments

IMF asset whose value is based on a "weighted basket" of four currencies

agreement (1971) among IMF members to restructure and strengthen the international monetary system created at Bretton Woods

agreement (1976) among IMF members to formalize the existing system of floating exchange rates as the new international monetary system

exchange-rate system in which currencies float against one another, with governments intervening to stabilize their currencies at particular target exchange rates

exchange-rate system in which currencies float freely against on another, without governments intervening in currency markets

monetary regime based on an explicit commitment to exchange domestic currency for a specified foreign currency at a fixed exchange rate

The international monetary system where gold is money and central banks kept wealth in gold with gold-backed notes

The international monetary system that was based on a "print and spend" mentality

The international monetary system that is headed by the IMG and the World Bank; the $ became a central reserve asset, and world international currency; all currencies were given values in terms of the $

International monetary system in which sigma hard currencies as central reserve assets; rates are determined by supply and demand