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The Monetary System in the International Arena - Coggle Diagram
The Monetary System in
the International Arena
Balance of Payments
all transactions % countries
demand and supply
Debit -$
Credit +$
Balance of Payments Disequilibrium
Autonomous transactions
Current Accounts
records all transactions involving goods and services
goods, services (tourism, banking, insurance,
brokerage services, transport), transfers, receipts of interest, profit and dividends
The Foreign Exchange Market
different national currencies are bought and sold
Capital Accounts
all transactions involving short-term and long-term assets.
Surplus
Exchange Rates in the Business Context
Demand and Supply of Foreign Exchange
exchange rate
demand and supply
high exchange rate encourages imports
$ increase
Purchasing Power Parity
short, medium, and long runs
Exchange Rate Regimes
fixed exchange
rates
flexible exchange rates
managed exchange rates.
The International Monetary System
institutions, rules, and regulations affects I. Payments
The Gold Standard
currencies were fixed
relative to the value of gold