what are the two advantages and two disadvantages of a floating exchange rate?
Solution
A floating exchange rate is one where the demand and supply of a domestic currency against the
foreign currency determine the exchange rate. In reality, the floating exchange rate in pure sense
does not exist.
Below are the advantages of a floating exchange rate-
i. Automatic adjustment of BOP - In a floating exchange rate, a county\'s balance of payment
disequilibrium will be adjusted by floating exchange rate mechanism. For example- A country
running BOP deficit will see its currency being depreciated in the international market. This will
boost its exports which will improve its BOP deficit.
ii. No need to maintain foreign exchange reserves- A country with fixed exchange rate regime
will have to maintain foreign exchange reserves. These are required to keep the foreign exchange
rate constant in case the demand for foreign exchange arises on account of higher demand for
imports.
Below are the disadvantages of a floating exchange rate-
i. Risk of imported inflation: When currency depreciates itself in a floating exchange rate, the
price of imports rise which increases the risk of imported inflation. Imported inflation can have
debilitating effect on economic growth since the real rate of returns on investment are also
affected.
ii. Uncertainty and Speculation: Floating exchange rate is subject to speculative activities by the
market agents. Such speculations increases uncertainty and risk which in turn affects the
economic perfomance of the country..
Balance of Payments and Exchange Rate PPT.pptxHimaanHarish1
Balance of Payments , Components of BOP, Current account; Causes of disequilibrium in Balance of Payments, Foreign Exchange rate,Devaluation, Appreciation , Revaluation and Depreciation,
Balance of Payments and Exchange Rate PPT.pptxHimaanHarish1
Balance of Payments , Components of BOP, Current account; Causes of disequilibrium in Balance of Payments, Foreign Exchange rate,Devaluation, Appreciation , Revaluation and Depreciation,
Factors that affect the currency exchange marketDivyaSharma842
Get the best deals on Currency Exchange across India with RRSB Forex. We provides the best rates for Money Exchange, Foreign currency exchange and forex travel credit card. All you have to do is book online and get it delivered!
The Relation between Balance of Payment and Foreign Exchange Ratemohamedosman370
The Definition of the (BOP)
The (BOP) structure
The Surplus and Deficit of (BOP)
Purposes of Official Reserve
The nominal and real exchange rate
The exchange rate regimes
What are the values of M if l 2m -5 l 12 ( m is a positive integer.pdfananyainfotech
What are the values of M if l 2m -5 l < 12 ( m is a positive integer).
Solution
To solve for |2m-5|<12.
For 2m-5> 5 or m> 5/2 , |2m-5| <12 implies 2m-5 < 12.
So for m > 5/2 = 2.5,
2m-5 = 12.
2m = 12+5
m = 17/2 = 8.5.
m 8.5.
When m < 5/2 = 2.5
|2m-5| = 5-2m.
Therefore the inequality becomes:
5-2m = 12.
5 = 12+2m.
5-12 = 2m
-7 = 2m.
-7/2 = m.
-3.5 = m
Therefore m = -3.5.
Therefore the solutions of the inequality are x = -3.5 and x = 8.5..
What are the various ways to discharge a valid contract Discuss the.pdfananyainfotech
What are the various ways to discharge a valid contract? Discuss the procedure in detail.
Solution
Discharge of contract is when the contract actually ends andboth parties are no longer obligated
to perform anything stipulatedwithin the agreement.
Adischarge can happen in various ways.
A contract may be discharged by an agreement tothat effect between the parties. This may be -
(a) By waiver, cancellation, orrescission.
(b) By a substituted contract.
(c) By the happening of conditions subsequent,expressed or implied in the contract.
Such an agreement must possess all the elementsrequisite to the formation of any other valid
agreement. There aresome exceptions as to the necessity for consideration, which willbe
hereafter noticed.
As it is their agreement which binds the parties,so by their agreement they may be loosed from
the contractual tie.It is scarcely necessary to say that to render an agreementeffective as a
discharge it must be a valid agreement; and, to beso, it must be accompanied by all the elements,
such ascommunication of mutual intention, real consent, parties havingcapacity.
More Related Content
Similar to what are the two advantages and two disadvantages of a floating exch.pdf
Factors that affect the currency exchange marketDivyaSharma842
Get the best deals on Currency Exchange across India with RRSB Forex. We provides the best rates for Money Exchange, Foreign currency exchange and forex travel credit card. All you have to do is book online and get it delivered!
The Relation between Balance of Payment and Foreign Exchange Ratemohamedosman370
The Definition of the (BOP)
The (BOP) structure
The Surplus and Deficit of (BOP)
Purposes of Official Reserve
The nominal and real exchange rate
The exchange rate regimes
What are the values of M if l 2m -5 l 12 ( m is a positive integer.pdfananyainfotech
What are the values of M if l 2m -5 l < 12 ( m is a positive integer).
Solution
To solve for |2m-5|<12.
For 2m-5> 5 or m> 5/2 , |2m-5| <12 implies 2m-5 < 12.
So for m > 5/2 = 2.5,
2m-5 = 12.
2m = 12+5
m = 17/2 = 8.5.
m 8.5.
When m < 5/2 = 2.5
|2m-5| = 5-2m.
Therefore the inequality becomes:
5-2m = 12.
5 = 12+2m.
5-12 = 2m
-7 = 2m.
-7/2 = m.
-3.5 = m
Therefore m = -3.5.
Therefore the solutions of the inequality are x = -3.5 and x = 8.5..
What are the various ways to discharge a valid contract Discuss the.pdfananyainfotech
What are the various ways to discharge a valid contract? Discuss the procedure in detail.
Solution
Discharge of contract is when the contract actually ends andboth parties are no longer obligated
to perform anything stipulatedwithin the agreement.
Adischarge can happen in various ways.
A contract may be discharged by an agreement tothat effect between the parties. This may be -
(a) By waiver, cancellation, orrescission.
(b) By a substituted contract.
(c) By the happening of conditions subsequent,expressed or implied in the contract.
Such an agreement must possess all the elementsrequisite to the formation of any other valid
agreement. There aresome exceptions as to the necessity for consideration, which willbe
hereafter noticed.
As it is their agreement which binds the parties,so by their agreement they may be loosed from
the contractual tie.It is scarcely necessary to say that to render an agreementeffective as a
discharge it must be a valid agreement; and, to beso, it must be accompanied by all the elements,
such ascommunication of mutual intention, real consent, parties havingcapacity.
what are the types of tarrifsSolutionTariffs is the tax or du.pdfananyainfotech
what are the types of tarrifs?
Solution
Tariffs is the tax or duty imposed by one nation on the imports of goods and service from another
nation.
There are two types of tax
1. Ad valorem tax - Which is nothing but a percentage charged on the value of the import
imported.
2. Specific tariff - It is the specific fee charged per number of items or by weight..
What are the Type I and Type II errors for the null hypothesis lip.pdfananyainfotech
What are the Type I and Type II errors for the null hypothesis \"lipitor is not considered to be a
calcium blocker.\"
Solution
Type I errors occur when you reject a true null hypothesis. In this case, you do the
research and find that lipitor really isn\'t considered to be a calcium blocker, but something goes
wrong and you say the opposite. A type II error occurs when you fail to reject a false null
hypothesis. Thus, you find that lipitor is a calcium blocker, but you say the opposite. Does that
help?.
What are the two key words to differentiate between the multiplicati.pdfananyainfotech
What are the two key words to differentiate between the multiplication rule and the addition
rule?
Solution
Rule of multiplication is that the probability that independent events will occur simultaneously is
the product of their individual probabilities.
Rule of addition is that the probability of an event that can occur in two or more independent
ways is the sum of the separate probabilities of the different ways.
What are the three components of the Decision RuleWhat are the fo.pdfananyainfotech
What are the three components of the Decision Rule?
What are the four components of the Decision Model?
Solution
What are the three components of the Decision Rule?
1. appropriate method of development
2. validation among a wide range of samples
3. ample predictive power
What are the four components of the Decision Model?
1. Moral sensitivity
2. Moral Judgement
3. Moral Motivation
4. Moral Character.
What are the vulnerabilities of Nuclear energy and what effect might.pdfananyainfotech
What are the vulnerabilities of Nuclear energy and what effect might an attack on a single reactor
or a coordinated attack on many reactors? What are its vulnerabilities and subsequent
consequences?
Solution
Vulnerabilities and subsequent consequences of Nuclear energy
1. Main problem with electricity generation from a nuclear power plant is its fuel requirements.
we need uranium, plutonium etc as the fuel inputs to nuclear power plants which are not easily
available due to its lackness and cost.
2. Uranium is available in nature but plutonium has to produce by applying the chain reaction in
the breeder. Breeders are nothing but a special type of power reactors. Chain reaction also
produce harmful radiations that affects health of human being.
3. After the generation of electricity, the wastage should be handled properly. It has to be
crushed at a proper place located far away from populated areas. If not handled at a proper
locations, radiations caused due to its wastage may harmful for human beings and radio isotopes
are also very harmful for nature.
4. We need a huge amount of money so as to install a nuclear power plant and also its fuel input
and machinery maintenance is so costly. So cost affects a lot.
5. Although a nuclear power plant generate a huge amount of energy but in near future may be
the fuel shall not available with us. So its a non-renewable source of power. Unlike solar, wind,
geothermal etc. we can not regenerate it. so, its non-renewability is one of its major drawback.
6. Risk factor is also there. We all are aware from second world war in which nuclear bomb were
applied and still the people of japan are in suffer. So in case of any accident results will be so
dangerous.
7. Further, Disposal of nuclear energy generation is so dirty and cause air and other type of
pollutions. So, it must be handled properly.
So, in brief, We find that nuclear energy generate a huge amount of electricity but it is risky,
dirty, costly and pollutionable. Improper handling and poor workmanship may effect attacks on
reactors..
What are the two critical values for a two-tailed test with a 0.01 l.pdfananyainfotech
What are the two critical values for a two-tailed test with a 0.01 level of significance when n is
large and the population standard deviation is known?
Solution
When the population standard deviation is known, we use the z distribution
Using a standard normal table: P(z > 2.575) = .005
the two critical values are ±2.575.
What are the two primary determinants of stock pricesSolution.pdfananyainfotech
What are the two primary determinants of stock prices?
Solution
The two primary determinants of stock prices are -
1) EPS, i.e. earings per share
It is the per share claim on the earnings on an investment. Higher earning imply that the stock
has a greater earning potential. Consequently, it will remain high on demand in the market. A
higher EPS could be seen as an indication of a bullish stock.
2) P/E ratio: It is valuation ratio. Here, P refers to the price of the one unit of share and E is the
earning per share. A ratio of price and EPS indicates the extent to which the company\'s growth
fundamentals are reflected in its price. It is expected that a higher EPS will be reflected in a
higher price. Stocks with higher Price-Earning ratio indicate strong earning potential..
What are the three chapters of bankruptcy and their purposeSolu.pdfananyainfotech
What are the three chapters of bankruptcy and their purpose?
Solution
Bankruptcy allows one an excuse to repay their some or all of their debt if they cannot meet their
financial obligation.
there are two types of bakruptcy - liquidation adn reorganisation. In case of liquidation
bankruptcy , debtors must surrender their property , which is sold and proceeds distributed to
creditors, debts thus permanently discharged ,In a reorganisation bankruptcy debtors keep their
property but promises to pay creditors in installment.
Tthe three chapters of bakruptcy adn their purpose
1)Chapter 7- Chapter 7 bankruptcy most common of three .All the non exempt property is
handed over to bankruptcy trustee (leaving exempt property like clothing, household items etc.)
Trustee then sell the property and pay of the creditors . th eunpaid portion is forgiven and never
collected.
2) Chapter 13- delas with reorganisation bakruptcy and comes in handy if you hace non exenpt
property ; thus allowing debtors to keep thier property but agreeing to pay the debt in
installmensts,Chapter 13 offer some benefits like certain secured debt can be restructured.
3) Chapter 7- is like personal reorganisation.IT allows business to ob taion protection from theri
creditors while they put togehter a repayament plan . liabilities can be reduced and restructured
to give the business another chance at achieving profitability..
What are the symmeteries of a parallelepipedSolutionPLANE OF .pdfananyainfotech
What are the symmeteries of a parallelepiped?
Solution
PLANE OF OF SYMMETRY IS SUCH A PLANE WHICH DIVIDES THE OBJECT IN TO 2
MIRROR EQUAL HALVES ARRANGED FROM EACH OTHER AS SOME
SUBJECT AND ITS MIRROR REFLECTION
SO .....
A PARALLELOPIPED HAS 3 ORTHOGONAL PLANES OF SYMMETRY ..
EACH PLANE BEING PARALLEL TO 2 OPPOSITE FACES AND GOING THROUGH THE
CENTER OF THE PARALLELOPIPED.
What are three economic roles of government Explain by giving examp.pdfananyainfotech
What are three economic roles of government? Explain by giving examples of the three.
Solution
Three economic roles of government are:-
1). Allocation role :- Government has to allocate funds for departments like defence, government
administration, R&D, Infrastructure etc,
2). Distribution role :- Another role of government is to distribute the income from taxes to put
into policies to benefit poor.
3). Stabilization role :- Goverment has to allocate funds to stabilize economy from recession or
economic turndown..
What are three risks of not including best HR practices into the man.pdfananyainfotech
What are three risks of not including best HR practices into the management of a project? 1
paragraph
Solution
Managing Risk: Rules or Dialogue?
The first step in creating an effective risk-management system is to understand the qualitative
distinctions among the types of risks that organizations face. Our field research shows that risks
fall into one of three categories. Risk events from any category can be fatal to a company.
What are three sources of error that can happen in traverses Give s.pdfananyainfotech
What are three sources of error that can happen in traverses? Give specific examples and make
an estimate as to the amount of error likely for each source.
What advantages are there to performing an accurate traverse in an area before surveying?
Why is it important to tie into monuments when performing a traverse?
Solution
Some sources of error in running a traverse are:
1.Poor selection of stations, resulting in bad sighting conditions caused by alternatesun and
shadow, visibility of inly the rod’s top, line of sight passing too close to theground, lines that are
too short, and sighting into the sun.
2.Errors in observations of angles and distances.
3.Failure to observe angle an equal number of time directs and reversed.
The advantages of performing an accurate traverse in an area are as follows:
1. The main advantage is that it takes much less effort for traversing than chain surveying.
2. The accuracy of traverse surveying is much more than the chain surveying.
3. The closed traverse is suitable for locating the boundaries of lakes, woods, etc and for survey
of large areas. the open traverse is suitable for surveying a long narrow strip of land as required
for a road of canal or the coast line.
4. Difficult terrains can be covered.
5. Accurate measurement of angles leads to accurate measurement of elevations and distances.
6. The error accuring due to sagging of chains and human effor is minimized.
It is important to tie the monuments when performing traverse because monuments acts as Bench
Marks. Bench marks are fixed reference points of known elevation. as the monuments are not
supoosed to change or alter due to their importance they can be used as bench marks..
What are two main concerns that MNCs should evaluate when doing busi.pdfananyainfotech
What are two main concerns that MNCs should evaluate when doing business in Russia?
Solution
Multinational corporations have existed since the beginning of overseas trade. They have
remained a part of the business scene throughout history, entering their modern form in the 17th
and 18th centuries with the creation of large, European-based monopolistic concerns such as the
British East India Company during the age of colonization. Multinational concerns were viewed
at that time as agents of civilization and played a pivotal role in the commercial and industrial
development of Asia, South America, and Africa. By the end of the 19th century, advances in
communications had more closely linked world markets, and multinational corporations retained
their favorable image as instruments of improved global relations through commercial ties. The
existence of close international trading relations did not prevent the outbreak of two world wars
in the first half of the twentieth century, but an even more closely bound world economy
emerged in the aftermath of the period of conflict.
In more recent times, multinational corporations have grown in power and visibility, but have
come to be viewed more ambivalently by both governments and consumers worldwide. Indeed,
multinationals today are viewed with increased suspicion given their perceived lack of concern
for the economic well-being of particular geographic regions and the public impression that
multinationals are gaining power in relation to national government agencies, international trade
federations and organizations, and local, national, and international labor organizations.
Despite such concerns, multinational corporations appear poised to expand their power and
influence as barriers to international trade continue to be removed. Furthermore, the actual nature
and methods of multinationals are in large measure misunderstood by the public, and their long-
term influence is likely to be less sinister than imagined. Multinational corporations share many
common traits, including the methods they use to penetrate new markets, the manner in which
their overseas subsidiaries are tied to their headquarters operations, and their interaction with
national governmental agencies and national and international labor organizations.
WHAT IS A MULTINATIONAL
CORPORATION?
As the name implies, a multinational corporation is a business concern with operations in more
than one country. These operations outside the company\'s home country may be linked to the
parent by merger, operated as subsidiaries, or have considerable autonomy. Multinational
corporations are sometimes perceived as large, utilitarian enterprises with little or no regard for
the social and economic well-being of the countries in which they operate, but the reality of their
situation is more complicated.
There are over 40,000 multinational corporations currently operating in the global economy, in
addition to approximately 250,000 overseas affiliates .
What are the three cases in reference to one sample hypothesis testi.pdfananyainfotech
What are the three cases in reference to one sample hypothesis testing.
Solution
Hypothesis testing is designed to detect significant differences: differences that did
not occur by random chance. In the “one sample” case: we compare a random sample (from a
large group) to a population. We compare a sample statistic to a population parameter to see if
there is a significant difference. 1. The Five-Step Model 2. Testing sample proportions, Z-Tests
and T-Tests 3. Two- tailed tests.
What are two main purposes of marketing communicationsSolution.pdfananyainfotech
What are two main purposes of marketing communications?
Solution
Purpose of Marketing Communication may be summarised as:
- Creating Brand Awareness
- Encourage Customers for product usage
First and the Foremost objective of marketing communication is creating Brand Awareness about
the product a marketeer wants to sell, this includes elaborating in detail the main essentials, the
key functions related to the USP (Unique Selling proposition) and working of the product to the
customers.
The ultimate goal of the marketeer is to convince the customer for the product usage through
advertisements by proper marketing channels, clearly explaining the benefits and the product
features to the customer to ultmaitely generate revenue for the seller..
What are the three main goals of the CIA Security Triad and what are.pdfananyainfotech
What are the three main goals of the CIA Security Triad and what are the most common gaps
you see exploited today? You may want to consider issues regarding access control in your
answer.
Solution
the three main goals of CIA is given bellow:
CONFIDENTIALITY:means that security sytem must provide confidentiality for our
passwords,data and etc
INTEGRITY:integrity keeps data pure and trusted
AVAILABILITY:keeps available for autherized users.this must overcome denial of service,loss
of information due to equipment failure.
...................................................
the accesss control problems may not fix quickly it may take time..
What are the strength and weakness of the SNIFF modelSolution.pdfananyainfotech
What are the strength and weakness of the SNIFF model?
Solution
Innovation clients frequently ask us how to make better decisions when pursuing breakthrough
innovation. Decision making in pursuit of breakthrough and transformational innovation is
significantly different that which is for sustaining or incremental innovation (where frames of
reference, past benchmarks, etc. exist). There are five key decision points along the journey. At
each point, beliefs, assumptions, SWAGS, etc. will get tighter, and more useful..
What are the steps that the IASB follow in the development of a typi.pdfananyainfotech
What are the steps that the IASB follow in the development of a typical IFRS?
Solution
The IASB follows mainly the following steps in the development of IFRS.They are:
The IASB considers
Finally a review may be conducted to analyse changes in financial reporting environment and
regulatory requirements, comments made by IFRS Advisory councils..
A workshop hosted by the South African Journal of Science aimed at postgraduate students and early career researchers with little or no experience in writing and publishing journal articles.
Safalta Digital marketing institute in Noida, provide complete applications that encompass a huge range of virtual advertising and marketing additives, which includes search engine optimization, virtual communication advertising, pay-per-click on marketing, content material advertising, internet analytics, and greater. These university courses are designed for students who possess a comprehensive understanding of virtual marketing strategies and attributes.Safalta Digital Marketing Institute in Noida is a first choice for young individuals or students who are looking to start their careers in the field of digital advertising. The institute gives specialized courses designed and certification.
for beginners, providing thorough training in areas such as SEO, digital communication marketing, and PPC training in Noida. After finishing the program, students receive the certifications recognised by top different universitie, setting a strong foundation for a successful career in digital marketing.
Normal Labour/ Stages of Labour/ Mechanism of LabourWasim Ak
Normal labor is also termed spontaneous labor, defined as the natural physiological process through which the fetus, placenta, and membranes are expelled from the uterus through the birth canal at term (37 to 42 weeks
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Acetabularia acetabulum is a single-celled green alga that in its vegetative state is morphologically differentiated into a basal rhizoid and an axially elongated stalk, which bears whorls of branching hairs. The single diploid nucleus resides in the rhizoid.
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Thinking of getting a dog? Be aware that breeds like Pit Bulls, Rottweilers, and German Shepherds can be loyal and dangerous. Proper training and socialization are crucial to preventing aggressive behaviors. Ensure safety by understanding their needs and always supervising interactions. Stay safe, and enjoy your furry friends!
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Odoo provides an option for creating a module by using a single line command. By using this command the user can make a whole structure of a module. It is very easy for a beginner to make a module. There is no need to make each file manually. This slide will show how to create a module using the scaffold method.
it describes the bony anatomy including the femoral head , acetabulum, labrum . also discusses the capsule , ligaments . muscle that act on the hip joint and the range of motion are outlined. factors affecting hip joint stability and weight transmission through the joint are summarized.
June 3, 2024 Anti-Semitism Letter Sent to MIT President Kornbluth and MIT Cor...Levi Shapiro
Letter from the Congress of the United States regarding Anti-Semitism sent June 3rd to MIT President Sally Kornbluth, MIT Corp Chair, Mark Gorenberg
Dear Dr. Kornbluth and Mr. Gorenberg,
The US House of Representatives is deeply concerned by ongoing and pervasive acts of antisemitic
harassment and intimidation at the Massachusetts Institute of Technology (MIT). Failing to act decisively to ensure a safe learning environment for all students would be a grave dereliction of your responsibilities as President of MIT and Chair of the MIT Corporation.
This Congress will not stand idly by and allow an environment hostile to Jewish students to persist. The House believes that your institution is in violation of Title VI of the Civil Rights Act, and the inability or
unwillingness to rectify this violation through action requires accountability.
Postsecondary education is a unique opportunity for students to learn and have their ideas and beliefs challenged. However, universities receiving hundreds of millions of federal funds annually have denied
students that opportunity and have been hijacked to become venues for the promotion of terrorism, antisemitic harassment and intimidation, unlawful encampments, and in some cases, assaults and riots.
The House of Representatives will not countenance the use of federal funds to indoctrinate students into hateful, antisemitic, anti-American supporters of terrorism. Investigations into campus antisemitism by the Committee on Education and the Workforce and the Committee on Ways and Means have been expanded into a Congress-wide probe across all relevant jurisdictions to address this national crisis. The undersigned Committees will conduct oversight into the use of federal funds at MIT and its learning environment under authorities granted to each Committee.
• The Committee on Education and the Workforce has been investigating your institution since December 7, 2023. The Committee has broad jurisdiction over postsecondary education, including its compliance with Title VI of the Civil Rights Act, campus safety concerns over disruptions to the learning environment, and the awarding of federal student aid under the Higher Education Act.
• The Committee on Oversight and Accountability is investigating the sources of funding and other support flowing to groups espousing pro-Hamas propaganda and engaged in antisemitic harassment and intimidation of students. The Committee on Oversight and Accountability is the principal oversight committee of the US House of Representatives and has broad authority to investigate “any matter” at “any time” under House Rule X.
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Explore how micro-credentials are transforming Technical and Vocational Education and Training (TVET) with this comprehensive slide deck. Discover what micro-credentials are, their importance in TVET, the advantages they offer, and the insights from industry experts. Additionally, learn about the top software applications available for creating and managing micro-credentials. This presentation also includes valuable resources and a discussion on the future of these specialised certifications.
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what are the two advantages and two disadvantages of a floating exch.pdf
1. what are the two advantages and two disadvantages of a floating exchange rate?
Solution
A floating exchange rate is one where the demand and supply of a domestic currency against the
foreign currency determine the exchange rate. In reality, the floating exchange rate in pure sense
does not exist.
Below are the advantages of a floating exchange rate-
i. Automatic adjustment of BOP - In a floating exchange rate, a county's balance of payment
disequilibrium will be adjusted by floating exchange rate mechanism. For example- A country
running BOP deficit will see its currency being depreciated in the international market. This will
boost its exports which will improve its BOP deficit.
ii. No need to maintain foreign exchange reserves- A country with fixed exchange rate regime
will have to maintain foreign exchange reserves. These are required to keep the foreign exchange
rate constant in case the demand for foreign exchange arises on account of higher demand for
imports.
Below are the disadvantages of a floating exchange rate-
i. Risk of imported inflation: When currency depreciates itself in a floating exchange rate, the
price of imports rise which increases the risk of imported inflation. Imported inflation can have
debilitating effect on economic growth since the real rate of returns on investment are also
affected.
ii. Uncertainty and Speculation: Floating exchange rate is subject to speculative activities by the
market agents. Such speculations increases uncertainty and risk which in turn affects the
economic perfomance of the country.
