Running Header ECONOMICS PAPER 1Ngai Lam Oscar Wong.docxagnesdcarey33086
Running Header: ECONOMICS PAPER
1
Ngai Lam Oscar Wong
Eco 102
Professor William Albanos
2/14/2013
Question 1)
A)Positive Vs Normative Economic Analysis Statements
Economics as an academic discipline quite commonly uses idea from media analysts, business consultants as well as advisers on government policy. It is therefore very imperative for an individual to understand instances when economists make objective, evidence-based statements concerning the world works as well as when they are making value judgments on policies issues (Beggs). In this case, economist usually uses positive and normative economic in analysis statements. Positive economic statement can be defined as objective, descriptive and factual statement that can be tested amended or rejected by referring to the available evidence and that deal with objective explanation and the testing and rejection of theories. On the other hand, negative economic statement can be referred to as statements that are subjective, prescriptive and value-based statements rather than objective statements. Positive economic statement is therefore objective and fact based, while normative economic statement is subjective and value based. Positive economic statements do not have to be correct, but they must be able to be tested and proved or disproved. Normative economic statements are opinion based, so they cannot be proved or disproved.
In summaries, a positive statement is a statement about what is and that contains no indication of approval or disapproval. It is the study of the causal relationships that exist in the economy. Positive economics deals with objective explanation and the testing and rejection of theories. It just states what the relationship is. There are no value judgments involved. The statement “if taxes on tobacco is doubled, there will be substantial reduction in tobacco consumption” is a positive economic statement. It just states what the situation is. “If government subsidy to basic education is reduced, there will be higher drop-outs among children of poor families”, is another positive economic statement.
On the other hand, a normative statement expresses a judgment about whether a situation is desirable or undesirable. Value judgments play an integral part in the ranking of possible objectives and the choices to be made among them. "The world would be a better place if the moon were made of green cheese" is a normative statement because it expresses a judgment about what ought to be ,buy most statements are not easily categorized as purely positive or purely normative. For example: Unemployment is more harmful than inflation. Notice that there is no way of disproving this statement. If you disagree with it, you have no sure way of convincing someone who believes the statement that he is wrong. Normative statements are subjective statements rather than objective statements – i.e. they carry value judgments. For example, price of second hand cars are falling. How.
PURCHASING POWER PARITY THEORY AND EXCHANGE RATE1.docxwoodruffeloisa
PURCHASING POWER PARITY THEORY AND EXCHANGE RATE1
Purchasing Power Parity Theory and Exchange Rate
Student’s Name
Professor’s Name
Institution
Table of Contents
Purchasing Power Parity Theory and Exchange Rate 3
Overview of Purchasing Power Parity Theory 3
Purchasing Power Parity and the Law of One Price 4
Types of Purchasing Power Parity 6
Long Run Exchange Rate 6
Ongoing Inflation, Interest Parity, and Purchasing Power Parity 8
Strengths and Weaknesses of Purchasing Power Parity 9
Empirical Analysis of Purchasing Power Parity Theory 10
Factors Explaining the Problem with Purchasing Power Parity 12
Traded Goods 12
Non-Tradables 13
Deviations from Free Competition 14
Price Measurement Levels and Consumption Patterns 14
Purchasing Power Parity in the Short Run and Long Run 15
Conclusion 16
Reference List 17
Purchasing Power Parity Theory and Exchange Rate
No nation is rich enough to rely on free gold standard. All countries across the globe have paper currencies that are not convertible into other valuable things including gold. Hence, nowadays nations have standard paper currencies, which complicate exchange situations. In such cases, the exchange rate between two currencies can be determined by their purchasing powers. The purchasing power parity theory holds that the rate of exchange between two nations depends on their currencies’ relative purchasing power. In essence, the exchange rate between currencies of two nations equals the ratio of their price levels. The purchasing power parity, therefore, predicts that a decline in a currency’s domestic purchasing power due to an increase in domestic prices, will lead to a proportional depreciation of the currency in foreign exchange market (Paul, Kimata & Khan 2017).
Conversely, purchasing power parity holds that an increase in currency domestic purchasing power will result in a proportional currency appreciation. For instance, if a certain good can be bought for $1 in the United States and 60 rupees in India, the purchasing power of$1 in the United States equals to purchasing power of 60 rupees in India. If in the United States $1 can buy a collection of goods that cost 80 rupees in India, then the exchange rate will be $1 equals to 80 rupees. This report tests the validity of absolute purchasing power parity and relative purchasing power by comparing the prices of commodities in the United States and India, and the exchange rates between the two countries. What product you are comparing mention it as well ??? Overview of Purchasing Power Parity Theory
Purchasing power parity is a simple theory that states that the nominal exchange rate between different currencies is the same as the ratio of aggregate commodity price levels between the two nations. This way, the unit of currency of one nation has the same purchasing power in another country. This theory has a long history, dating back many years ago (Pilbeam 2013). The primary idea behind the theory is that a unit of currency ou ...
FIRST DRAFT 1Impact of Interest Rates on InflationJameShainaBoling829
FIRST DRAFT 1
Impact of Interest Rates on Inflation
James C. Goggans
Embry Riddle Aeronautical University
Professor Audra Sherwood
Economics 211
21 November 2021
FIRST DRAFT 2
Introduction
Interest rates play a significant role in shaping a country's economy. The Federal Reserve
System in the US determines the interest rates, which determine the prices of goods and
services in the market (Ferreira & Shousha, 2021). The two concepts are linked, and
academicians have established both direct and inverse relationships between the two
concepts. Some academicians argue that since both inflation and interest rates are driven by
money, they have a direct relationship such that an increase in interest rates increases the rate
of inflation and vice versa. However, the money quantity theory establishes an inverse
relationship between interest rates and inflation; High-interest rates reduce money circulation,
which leads to a reduction in prices. On the other hand, low-interest rates increase money
circulation, which increases the price of goods and services.
Literature Review
Definition of Inflation
Academicians define inflation differently. However, the most harmonizing definition of
inflation is the decline in a currency's value or purchasing power. The decline takes place
over time and affects the general price of goods and services in the market. When there is
inflation, a currency unit buys less than what it used to but previously. For example, if the
price of bread increases from $ 1 to $ 1.50, it means the value of the currency has reduced,
and more money has to be used to buy bread. When there is inflation, the money supply
increases in an economy faster than the production of goods and services required in the
market. This leads to an imbalance between supply and demand in a country's economy.
Definition of Interest rate
Kiley & Roberts (2017) define interest rate as the amount a lender charges a borrower,
expressed as a percentage of the principal. It is typically represented as an annual percentage,
Audra Sherwood
23860000000004354
All paragraphs need to be indented 1/ 2 inch.
FIRST DRAFT 3
and the borrower pays back the principal and the interest. According to the International
Monetary fund, interest rates serves three functions;
It serves as a return on the financial asset so that it can promote deferred consumption, a
saving that will facilitate future activities.
It is also considered a cost of capital that will determine the amount of money that can be
loaned to members of the public.
The interest rates within a country and the return rate of foreign financial assets are normally
evaded against inflation.
Based on these functions, it is clear that interest rates impact the economy dramatically. It
also affects other variables that will influence investment activities that shape economic
growth and a country's development.
What is the relationship between in ...
I need a 100 word reply to each of the following 8 forum post from.docxtroutmanboris
I need a 100 word reply to each of the following 8 forum post from a finance class. (800 words total):
Finance Forum Reply #1
By using ratios, financial analysts are able to “
predict financial variables and to evaluate relative performance” when looking at financial statements (Giacomino and Mielke, 1993).
This provides the advantages of being able to evaluate the strength and profitability of a company, as well as being helpful in identifying and predicting possible bankruptcy and financial distress (Giacomino and Mielke, 1993).
A disadvantage of using financial ratio analysis is that to be effective, a company has to have another company to compare to.
Without comparison, all of the financial data analyzed for a particular business could be useless.
This is especially the case with small, niche-type businesses (Accounting Explained, 2013).
Another disadvantage of using financial ratio analysis is that it is analyzing historical information, while the users of the data are more interested in “current and future information” (Accounting Explained, 2013).
References
:
Giacomino, D. E., & Mielke, D. E. (1993). Cash flows: Another approach to ratio
analysis.
Journal of Accountancy, 175
(3), 55.
Accounting Explained (2011-2013).
Advantages and Limitations of Ratio Analysis.
Finance Forum Reply #2
Making a choice of a ratio is determined on the present need and purpose of the individual. Liquidity, leverage and investment return are what can be used to study the usage of ratios. Strong liquidity, cash and capital help with the financing that a company has for any given project.
In the article by James Horrigan, it provides a short history of financial ratio analysis. It tells of the five financial ratios that are used for the studies. The financial ratios are: working capital-to-current liabilities ratio (WC/CL) for short term liquidity; cash flow-to-current liabilities ratio (CFCL) for cash position; net worth-to-total liabilities ratio (NW/TL) for long-term solvency; return on total assets (EBIT/TA) for profit-generating ability; and revenue-to-total (REV/TA) for managerial performance (Halim, Jaafar& Osmon). Ratios are formed to be simple and are an advantage with analysis.
In the article by Paul Barnes he gives two principals for using ratios, 1. To control for the effect of size on the financial variables being examined. The use of ratios was necessarily based on a hypothesis about the relationship between the numerator variable and the denominator size variable. 2. To control for industry-wide factors. Ratios aid comparisions between subject firm and its industry. As financial ratios are constructed from two accounting variables, the joint distribution will depend on the behavior of both the numerator and the denominator and on the relationship between these two coordinates.
1. Horrigan, J. O. (1968). A Short History of Financial Ratio Analysis. Accounting Review, 43(2), 284-294..
2. Barnes, P. (1987).
Best Film Analysis Essay Examples PNG - scholarship. Writing essays about movies. movie essay | Teaching Method | Motivation. Film Essay. Example Film Essay Thesis - How to Write an Evaluation Essay. 006 Essay Movies English Paper Help How To Write For High School .... 017 Film Essay Example Rashomonessay Phpapp02 Thumbnail ~ Thatsnotus. 003 Example Movie Review Essays 130056 Essay ~ Thatsnotus. 004 Evaluation Essay On Movie Example Review Film Sample Short The .... 003 Film Essay Example Movie Review Essays 130056 ~ Thatsnotus.
Running Header ECONOMICS PAPER 1Ngai Lam Oscar Wong.docxagnesdcarey33086
Running Header: ECONOMICS PAPER
1
Ngai Lam Oscar Wong
Eco 102
Professor William Albanos
2/14/2013
Question 1)
A)Positive Vs Normative Economic Analysis Statements
Economics as an academic discipline quite commonly uses idea from media analysts, business consultants as well as advisers on government policy. It is therefore very imperative for an individual to understand instances when economists make objective, evidence-based statements concerning the world works as well as when they are making value judgments on policies issues (Beggs). In this case, economist usually uses positive and normative economic in analysis statements. Positive economic statement can be defined as objective, descriptive and factual statement that can be tested amended or rejected by referring to the available evidence and that deal with objective explanation and the testing and rejection of theories. On the other hand, negative economic statement can be referred to as statements that are subjective, prescriptive and value-based statements rather than objective statements. Positive economic statement is therefore objective and fact based, while normative economic statement is subjective and value based. Positive economic statements do not have to be correct, but they must be able to be tested and proved or disproved. Normative economic statements are opinion based, so they cannot be proved or disproved.
In summaries, a positive statement is a statement about what is and that contains no indication of approval or disapproval. It is the study of the causal relationships that exist in the economy. Positive economics deals with objective explanation and the testing and rejection of theories. It just states what the relationship is. There are no value judgments involved. The statement “if taxes on tobacco is doubled, there will be substantial reduction in tobacco consumption” is a positive economic statement. It just states what the situation is. “If government subsidy to basic education is reduced, there will be higher drop-outs among children of poor families”, is another positive economic statement.
On the other hand, a normative statement expresses a judgment about whether a situation is desirable or undesirable. Value judgments play an integral part in the ranking of possible objectives and the choices to be made among them. "The world would be a better place if the moon were made of green cheese" is a normative statement because it expresses a judgment about what ought to be ,buy most statements are not easily categorized as purely positive or purely normative. For example: Unemployment is more harmful than inflation. Notice that there is no way of disproving this statement. If you disagree with it, you have no sure way of convincing someone who believes the statement that he is wrong. Normative statements are subjective statements rather than objective statements – i.e. they carry value judgments. For example, price of second hand cars are falling. How.
PURCHASING POWER PARITY THEORY AND EXCHANGE RATE1.docxwoodruffeloisa
PURCHASING POWER PARITY THEORY AND EXCHANGE RATE1
Purchasing Power Parity Theory and Exchange Rate
Student’s Name
Professor’s Name
Institution
Table of Contents
Purchasing Power Parity Theory and Exchange Rate 3
Overview of Purchasing Power Parity Theory 3
Purchasing Power Parity and the Law of One Price 4
Types of Purchasing Power Parity 6
Long Run Exchange Rate 6
Ongoing Inflation, Interest Parity, and Purchasing Power Parity 8
Strengths and Weaknesses of Purchasing Power Parity 9
Empirical Analysis of Purchasing Power Parity Theory 10
Factors Explaining the Problem with Purchasing Power Parity 12
Traded Goods 12
Non-Tradables 13
Deviations from Free Competition 14
Price Measurement Levels and Consumption Patterns 14
Purchasing Power Parity in the Short Run and Long Run 15
Conclusion 16
Reference List 17
Purchasing Power Parity Theory and Exchange Rate
No nation is rich enough to rely on free gold standard. All countries across the globe have paper currencies that are not convertible into other valuable things including gold. Hence, nowadays nations have standard paper currencies, which complicate exchange situations. In such cases, the exchange rate between two currencies can be determined by their purchasing powers. The purchasing power parity theory holds that the rate of exchange between two nations depends on their currencies’ relative purchasing power. In essence, the exchange rate between currencies of two nations equals the ratio of their price levels. The purchasing power parity, therefore, predicts that a decline in a currency’s domestic purchasing power due to an increase in domestic prices, will lead to a proportional depreciation of the currency in foreign exchange market (Paul, Kimata & Khan 2017).
Conversely, purchasing power parity holds that an increase in currency domestic purchasing power will result in a proportional currency appreciation. For instance, if a certain good can be bought for $1 in the United States and 60 rupees in India, the purchasing power of$1 in the United States equals to purchasing power of 60 rupees in India. If in the United States $1 can buy a collection of goods that cost 80 rupees in India, then the exchange rate will be $1 equals to 80 rupees. This report tests the validity of absolute purchasing power parity and relative purchasing power by comparing the prices of commodities in the United States and India, and the exchange rates between the two countries. What product you are comparing mention it as well ??? Overview of Purchasing Power Parity Theory
Purchasing power parity is a simple theory that states that the nominal exchange rate between different currencies is the same as the ratio of aggregate commodity price levels between the two nations. This way, the unit of currency of one nation has the same purchasing power in another country. This theory has a long history, dating back many years ago (Pilbeam 2013). The primary idea behind the theory is that a unit of currency ou ...
FIRST DRAFT 1Impact of Interest Rates on InflationJameShainaBoling829
FIRST DRAFT 1
Impact of Interest Rates on Inflation
James C. Goggans
Embry Riddle Aeronautical University
Professor Audra Sherwood
Economics 211
21 November 2021
FIRST DRAFT 2
Introduction
Interest rates play a significant role in shaping a country's economy. The Federal Reserve
System in the US determines the interest rates, which determine the prices of goods and
services in the market (Ferreira & Shousha, 2021). The two concepts are linked, and
academicians have established both direct and inverse relationships between the two
concepts. Some academicians argue that since both inflation and interest rates are driven by
money, they have a direct relationship such that an increase in interest rates increases the rate
of inflation and vice versa. However, the money quantity theory establishes an inverse
relationship between interest rates and inflation; High-interest rates reduce money circulation,
which leads to a reduction in prices. On the other hand, low-interest rates increase money
circulation, which increases the price of goods and services.
Literature Review
Definition of Inflation
Academicians define inflation differently. However, the most harmonizing definition of
inflation is the decline in a currency's value or purchasing power. The decline takes place
over time and affects the general price of goods and services in the market. When there is
inflation, a currency unit buys less than what it used to but previously. For example, if the
price of bread increases from $ 1 to $ 1.50, it means the value of the currency has reduced,
and more money has to be used to buy bread. When there is inflation, the money supply
increases in an economy faster than the production of goods and services required in the
market. This leads to an imbalance between supply and demand in a country's economy.
Definition of Interest rate
Kiley & Roberts (2017) define interest rate as the amount a lender charges a borrower,
expressed as a percentage of the principal. It is typically represented as an annual percentage,
Audra Sherwood
23860000000004354
All paragraphs need to be indented 1/ 2 inch.
FIRST DRAFT 3
and the borrower pays back the principal and the interest. According to the International
Monetary fund, interest rates serves three functions;
It serves as a return on the financial asset so that it can promote deferred consumption, a
saving that will facilitate future activities.
It is also considered a cost of capital that will determine the amount of money that can be
loaned to members of the public.
The interest rates within a country and the return rate of foreign financial assets are normally
evaded against inflation.
Based on these functions, it is clear that interest rates impact the economy dramatically. It
also affects other variables that will influence investment activities that shape economic
growth and a country's development.
What is the relationship between in ...
I need a 100 word reply to each of the following 8 forum post from.docxtroutmanboris
I need a 100 word reply to each of the following 8 forum post from a finance class. (800 words total):
Finance Forum Reply #1
By using ratios, financial analysts are able to “
predict financial variables and to evaluate relative performance” when looking at financial statements (Giacomino and Mielke, 1993).
This provides the advantages of being able to evaluate the strength and profitability of a company, as well as being helpful in identifying and predicting possible bankruptcy and financial distress (Giacomino and Mielke, 1993).
A disadvantage of using financial ratio analysis is that to be effective, a company has to have another company to compare to.
Without comparison, all of the financial data analyzed for a particular business could be useless.
This is especially the case with small, niche-type businesses (Accounting Explained, 2013).
Another disadvantage of using financial ratio analysis is that it is analyzing historical information, while the users of the data are more interested in “current and future information” (Accounting Explained, 2013).
References
:
Giacomino, D. E., & Mielke, D. E. (1993). Cash flows: Another approach to ratio
analysis.
Journal of Accountancy, 175
(3), 55.
Accounting Explained (2011-2013).
Advantages and Limitations of Ratio Analysis.
Finance Forum Reply #2
Making a choice of a ratio is determined on the present need and purpose of the individual. Liquidity, leverage and investment return are what can be used to study the usage of ratios. Strong liquidity, cash and capital help with the financing that a company has for any given project.
In the article by James Horrigan, it provides a short history of financial ratio analysis. It tells of the five financial ratios that are used for the studies. The financial ratios are: working capital-to-current liabilities ratio (WC/CL) for short term liquidity; cash flow-to-current liabilities ratio (CFCL) for cash position; net worth-to-total liabilities ratio (NW/TL) for long-term solvency; return on total assets (EBIT/TA) for profit-generating ability; and revenue-to-total (REV/TA) for managerial performance (Halim, Jaafar& Osmon). Ratios are formed to be simple and are an advantage with analysis.
In the article by Paul Barnes he gives two principals for using ratios, 1. To control for the effect of size on the financial variables being examined. The use of ratios was necessarily based on a hypothesis about the relationship between the numerator variable and the denominator size variable. 2. To control for industry-wide factors. Ratios aid comparisions between subject firm and its industry. As financial ratios are constructed from two accounting variables, the joint distribution will depend on the behavior of both the numerator and the denominator and on the relationship between these two coordinates.
1. Horrigan, J. O. (1968). A Short History of Financial Ratio Analysis. Accounting Review, 43(2), 284-294..
2. Barnes, P. (1987).
Best Film Analysis Essay Examples PNG - scholarship. Writing essays about movies. movie essay | Teaching Method | Motivation. Film Essay. Example Film Essay Thesis - How to Write an Evaluation Essay. 006 Essay Movies English Paper Help How To Write For High School .... 017 Film Essay Example Rashomonessay Phpapp02 Thumbnail ~ Thatsnotus. 003 Example Movie Review Essays 130056 Essay ~ Thatsnotus. 004 Evaluation Essay On Movie Example Review Film Sample Short The .... 003 Film Essay Example Movie Review Essays 130056 ~ Thatsnotus.
Solid waste management & Types of Basic civil Engineering notes by DJ Sir.pptxDenish Jangid
Solid waste management & Types of Basic civil Engineering notes by DJ Sir
Types of SWM
Liquid wastes
Gaseous wastes
Solid wastes.
CLASSIFICATION OF SOLID WASTE:
Based on their sources of origin
Based on physical nature
SYSTEMS FOR SOLID WASTE MANAGEMENT:
METHODS FOR DISPOSAL OF THE SOLID WASTE:
OPEN DUMPS:
LANDFILLS:
Sanitary landfills
COMPOSTING
Different stages of composting
VERMICOMPOSTING:
Vermicomposting process:
Encapsulation:
Incineration
MANAGEMENT OF SOLID WASTE:
Refuse
Reuse
Recycle
Reduce
FACTORS AFFECTING SOLID WASTE MANAGEMENT:
This is a presentation by Dada Robert in a Your Skill Boost masterclass organised by the Excellence Foundation for South Sudan (EFSS) on Saturday, the 25th and Sunday, the 26th of May 2024.
He discussed the concept of quality improvement, emphasizing its applicability to various aspects of life, including personal, project, and program improvements. He defined quality as doing the right thing at the right time in the right way to achieve the best possible results and discussed the concept of the "gap" between what we know and what we do, and how this gap represents the areas we need to improve. He explained the scientific approach to quality improvement, which involves systematic performance analysis, testing and learning, and implementing change ideas. He also highlighted the importance of client focus and a team approach to quality improvement.
Solid waste management & Types of Basic civil Engineering notes by DJ Sir.pptxDenish Jangid
Solid waste management & Types of Basic civil Engineering notes by DJ Sir
Types of SWM
Liquid wastes
Gaseous wastes
Solid wastes.
CLASSIFICATION OF SOLID WASTE:
Based on their sources of origin
Based on physical nature
SYSTEMS FOR SOLID WASTE MANAGEMENT:
METHODS FOR DISPOSAL OF THE SOLID WASTE:
OPEN DUMPS:
LANDFILLS:
Sanitary landfills
COMPOSTING
Different stages of composting
VERMICOMPOSTING:
Vermicomposting process:
Encapsulation:
Incineration
MANAGEMENT OF SOLID WASTE:
Refuse
Reuse
Recycle
Reduce
FACTORS AFFECTING SOLID WASTE MANAGEMENT:
This is a presentation by Dada Robert in a Your Skill Boost masterclass organised by the Excellence Foundation for South Sudan (EFSS) on Saturday, the 25th and Sunday, the 26th of May 2024.
He discussed the concept of quality improvement, emphasizing its applicability to various aspects of life, including personal, project, and program improvements. He defined quality as doing the right thing at the right time in the right way to achieve the best possible results and discussed the concept of the "gap" between what we know and what we do, and how this gap represents the areas we need to improve. He explained the scientific approach to quality improvement, which involves systematic performance analysis, testing and learning, and implementing change ideas. He also highlighted the importance of client focus and a team approach to quality improvement.
The Roman Empire A Historical Colossus.pdfkaushalkr1407
The Roman Empire, a vast and enduring power, stands as one of history's most remarkable civilizations, leaving an indelible imprint on the world. It emerged from the Roman Republic, transitioning into an imperial powerhouse under the leadership of Augustus Caesar in 27 BCE. This transformation marked the beginning of an era defined by unprecedented territorial expansion, architectural marvels, and profound cultural influence.
The empire's roots lie in the city of Rome, founded, according to legend, by Romulus in 753 BCE. Over centuries, Rome evolved from a small settlement to a formidable republic, characterized by a complex political system with elected officials and checks on power. However, internal strife, class conflicts, and military ambitions paved the way for the end of the Republic. Julius Caesar’s dictatorship and subsequent assassination in 44 BCE created a power vacuum, leading to a civil war. Octavian, later Augustus, emerged victorious, heralding the Roman Empire’s birth.
Under Augustus, the empire experienced the Pax Romana, a 200-year period of relative peace and stability. Augustus reformed the military, established efficient administrative systems, and initiated grand construction projects. The empire's borders expanded, encompassing territories from Britain to Egypt and from Spain to the Euphrates. Roman legions, renowned for their discipline and engineering prowess, secured and maintained these vast territories, building roads, fortifications, and cities that facilitated control and integration.
The Roman Empire’s society was hierarchical, with a rigid class system. At the top were the patricians, wealthy elites who held significant political power. Below them were the plebeians, free citizens with limited political influence, and the vast numbers of slaves who formed the backbone of the economy. The family unit was central, governed by the paterfamilias, the male head who held absolute authority.
Culturally, the Romans were eclectic, absorbing and adapting elements from the civilizations they encountered, particularly the Greeks. Roman art, literature, and philosophy reflected this synthesis, creating a rich cultural tapestry. Latin, the Roman language, became the lingua franca of the Western world, influencing numerous modern languages.
Roman architecture and engineering achievements were monumental. They perfected the arch, vault, and dome, constructing enduring structures like the Colosseum, Pantheon, and aqueducts. These engineering marvels not only showcased Roman ingenuity but also served practical purposes, from public entertainment to water supply.
Basic Civil Engineering Notes of Chapter-6, Topic- Ecosystem, Biodiversity Green house effect & Hydrological cycle
Types of Ecosystem
(1) Natural Ecosystem
(2) Artificial Ecosystem
component of ecosystem
Biotic Components
Abiotic Components
Producers
Consumers
Decomposers
Functions of Ecosystem
Types of Biodiversity
Genetic Biodiversity
Species Biodiversity
Ecological Biodiversity
Importance of Biodiversity
Hydrological Cycle
Green House Effect
Palestine last event orientationfvgnh .pptxRaedMohamed3
An EFL lesson about the current events in Palestine. It is intended to be for intermediate students who wish to increase their listening skills through a short lesson in power point.
The Indian economy is classified into different sectors to simplify the analysis and understanding of economic activities. For Class 10, it's essential to grasp the sectors of the Indian economy, understand their characteristics, and recognize their importance. This guide will provide detailed notes on the Sectors of the Indian Economy Class 10, using specific long-tail keywords to enhance comprehension.
For more information, visit-www.vavaclasses.com
Extraction Of Natural Dye From Beetroot (Beta Vulgaris) And Preparation Of He...SachinKumar945617
If you want to make , ppt, dissertation/research, project or any document edit service
DM me on what's app 8434381558
E-mail sachingone220@gmail.com
I will take charge depend upon how much pages u want
The Art Pastor's Guide to Sabbath | Steve ThomasonSteve Thomason
What is the purpose of the Sabbath Law in the Torah. It is interesting to compare how the context of the law shifts from Exodus to Deuteronomy. Who gets to rest, and why?
Home assignment II on Spectroscopy 2024 Answers.pdf
BUSN601 Central Texas Purchasing Power Parity Interest Rate Parity Response.docx
1. BUSN601 Central Texas Purchasing Power Parity & Interest Rate Parity
Response
Question DescriptionHello,I need four responses of at least 150 words each for the below
students discussions for this week. Also in the bold below are the questions the students at
answering.Fortunately, the theories of both purchasing power parity and interest rate
parity do not have any problems. Do you agree with this statement? In 250 words, defend
your position.Student one:I will would like to state that I disagree with the statement that
purchasing power parity and interest rate parity theories do not have any
problems.Whenever we want to compare money, we have two options to deal with it. One is
purchasing power parity and exchange rate.Purchasing power parity (PPP) is an economic
theory that allows the appraisal of the purchasing power of various currencies to one
another. It is the exchange rate that allows you to buy the same amount of goods and
services in every country.That means product between two countries should in essence be
the same in the long run. Like a basket of goods that are traded between should cost same in
different market. An examples is say, using a $100 to buy the same quantity of products in
each country. Theory basically measures goods and services that can be bought with certain
amount of money.The Problems with the Purchasing Power Parity (PPP) theory is that the
PPP condition is rarely satisfied within a country. (“Purchasing Power Parity theory video,”
n.d.)Among consumer goods and services items such as food, drinks, clothing, footwear,
tobacco, rents, medical goods and services, water and gas supply, fuel, transport services,
recreational and cultural services, education services etc will always vary from country to
country which will not factor in demand and supply.Interest rate parity theory on the other
hand, refers to a condition of equality between the rates of return on comparable assets
between two countries. So again in essence, the dollar interest rate on the U.S. and
European bonds should be the same which is not the case.ReferencesBritish pound (GBP)
and United States dollar (USD) Year 2014 Exchange Rate History. The Central Bank of the
Russian Federation (CBR). (n.d.). Retrieved from
https://freecurrencyrates.com/en/exchange-rate-his…Park, D., Shin, K., & Tian, S. (2018).
Do Local Currency Bond Markets Enhance Financial Stability? ADB Economics Working
Paper Series. doi:10.22617/wps189596-2Purchasing Power Parity theory video. (n.d.).
Retrieved from https://www.bing.com/videos/search?q=Purchasing+Po…Student
two:Good afternoon classmates,It would be great to say that the theories of both purchasing
power parity and interest rate parity don’t have any problems but that is not the case. I feel
2. that the two parities are ‘good enough’ to make comparisons and accepted methods of
comparisons. Purchasing power parity using the “basket of goods” method by comparing an
exact group of items in a “basket” between two countries, priced the same in both countries
and their respective exchange rates can compare the prices of good/services. The
comparison cannot be done not equally. There is additional data that would need to be
added to this calculation but it is a good way to get an idea of the cost comparison. This
method is just not perfect or exact. There are additional things to factor in such as:
“transport cost, tax differences, government intervention (tariffs), non-traded services, and
market competition”. (Hall, 2019)The interest rate parity theory is comparing the rates
between two countries, assuming they are equal. It connects interest rates, spot exchanges
and foreign exchange rates. (Hayes, 2019) The problem with using this is the constant
change in the exchange rates and the forward rates which are predetermined rates for a
contract. It seems like a good way to estimate the cost of an item or service but not a solid or
very true over view. A limitation of the IPR is that of the “future or forward contracts that
are not available to hedge, uncovered interest rate parity doesn’t tend to hold in the real
world.” (2019)There are too many variables that are not included when using the PPP and
the IRP. This leaves for an inaccurate value for comparison.Hall, Mary. (2019). What is
purchasing power parity (PPP)? Retrieved from:
https://www.investopedia.com/updates/purchasing-power-parity-ppp/Hayes, Adam.
(2019). Interest Rate Parity-IPR Definition. Retrieved from:
https://www.investopedia.com/terms/i/interestrateparity.aspStudent three:The theories
of both purchasing power parity and interest rate parity are not free from problems. They
both have their pros and cons and are capable of being used to their full potential
depending on the market. Purchasing power parity is a theory that a specific “good” should
be the same price no matter the location. This sounds good in theory, but this is not the case
due to taxes, tariffs, and other ramifications. Though countries have working relationships
with one another, they have to implement regulations that benefit themselves financially.
Therefore, the prices cannot all be equal due to the markets in which the goods are being
facilitated. The main factor that is involved in the purchasing power parity is the gross
national product of a country. If you take one million iPad’s and sell them in Vietnam for $50
a piece; this wouldn’t seem outrageous for their economy. However, selling one million
iPad’s in America for $50 a piece will not suffice. America has a higher cost of living and
businesses need to make more for themselves and their employees to survive. Purchasing
power parity has the end goal of placing the overall sale of goods into equilibrium (Jiang et
al, 2015). Consumerism in America is also higher than a country like Vietnam and a device
like an iPad can and should be sold for a higher cost.Interest rate parity looks to put the rate
of return on goods into equilibrium between two countries (Pipatchaipoom & Norrbin,
2010). Interest rate parity depends strongly on the bank of each country. Not all banks
function exactly the same and two countries doing business with one another have to take
that into consideration. A country with a high interest will have a higher value than the
other country’s currency value. Taking that into consideration, this theory would hurt a
country like America if they were doing business with a country like Macedonia. Both
theories sound like great and simple ideas, but there is always more to business. All parties
3. involved are trying to make a deal where they benefit the most. The difference in the
currency of countries doing business with one another is never equal and it is all numbers
game to come up with the best outcome. The above statement, when not looked at in detail,
can lead one astray and cause the reader or businessman to not see the big picture when it
comes to business.ReferencesJiang, C., Bahmani-Oskooee, M., & Chang, T. (2015). Revisiting
Purchasing Power Parity in OECD. Applied Economics, 47(40), 4323–4334.
https://doi.org/10.1080/00036846.2015.1026592Pipatchaipoom, O., & Norrbin, S. (2010).
Is the real interest rate parity condition affected by the method of calculating real interest
rates? Applied Economics, 42(14), 1771–1782.
https://doi.org/10.1080/00036840701736073Student four:Macroeconomics is the branch
of economics that studies behaviors and performance of an economy. It analyses broad
range of indexes from price levels, rate of economic growth, national income, price levels,
rate of economic growth, national income, gross domestic product (GDP) as well as changes
in unemployment. With globalization and trade that aim at eliminating barriers while
promoting exchange between partner nations, there is a need for a comprehensive
mechanism to help measure or assure the flow of goods and capital. Purchasing Power
Parity, an exchange rate determination theory aims at comparing prices of goods and
services between countries. This theory is based on a variation of the “law of one price”
which states that identical goods should sell for the same price in two different markets
where there exist neither taxes nor transportation cost between the two markets. If we look
closely at Mexico and United State, two countries of NAFTA, and we randomly picked a DVD
at a local store in Houston, TX that sell for 15 USD (US Dollar). The same item sells for
about120 MXN (Mexican Peso), considering the spot exchange rate of the current year
(2019), the best rate is estimated at 20.1608 MXN to 1 USD. For simplified calculation
purpose we will round it to 20. Quick mathematic dividing 120 by 20 gives us 6$. In other
words, the same digital medium is almost 80 percent cheaper in Mexico City than in
Houston, TX. If the theory of PPP held in this case, the prices should not have been different.
One may be tempted to purchase as many DVDs as he could on his next vacation in Mexico
and turn them in to profit once back on the main land. This will directly fall under the
“goods arbitrage” where items can be purchased in one market at a lower price and sold in a
different market for profit. Over time, as it becomes obvious that certain goods can be
obtained at a relatively cheaper price, this could lead to price change driven by supply and
demand.Interest Rate Parity theory proposes a relationship between interest rates of two
given currencies and the spot and forward exchange rates between the currencies. It
assumes that the difference in exchange rate between currencies induces readjustment of
the exchange rate. Another assumption of the IRP is the non-existence of arbitrage
opportunities leaving investor indifferent as changes (excess or shortage) in deposits on
one currency or the other are offset through devaluation or appreciation. If the political
environment of one country changes, and the liberties of citizens are in jeopardy, this could
affect the supply and demand of a specific currency in the global market. This external
factor influencing the exchange rate parity theory negates the IRP’s assumption of induced
readjustments. It will be hard to agree with the statement of PPP and IRP being problem
free.ReferencesManal, N. (2019, February 11). What Determines the Value of Currency?