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Module 13 ECON DB: Exchange Rate Systems and Currency Crises

Description

Module 13 ECON DB: Exchange Rate Systems and Currency Crises

Currency Devaluation

  • Discuss the purpose of a currency devaluation? What about a currency revaluation? Under what circumstances should a nation devalue currency?
  • Identify a developing country that adopted currency boards? Discuss why they chose this instead of dollarizing their monetary systems.

Directions:

  • Discuss the concepts, principles, and theories from your textbook. Cite your textbooks and cite any other sources if appropriate.
  • Your initial post should address all components of the question with a 500 word limit.

This module will look at exchange rate systems more broadly. We will consider a worst-case scenario for balance of payments (BOP) and exchange rate disequilibrium that has become all too present in today’s global economy—the currency crisis.

Learning Outcomes

  1. Describe various exchange rate systems that have been used historically and are used currently.
  2. Analyze currency crises and the economic mechanisms that bring currency crises about.

Readings

Required:

Chapter 14 in International Economics

Kamal, U., Dharmendra, D. & Franklin, M. (2020). Exchange rate volatility and exports: some new estimates from the Asean-5. Journal of Developing Areas, 54(1), 65-73.

Recommended:

Chapter 14 PowerPoint slides

Lee, S. (2020). Foreign exchange rate uncertainty in Korea. East Asian Economic Review, 24(2), 165-184. Retrieved from

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