Wednesday, February 04, 2009

Unit 2: The effect of the high Yen on Japenese exports

This BBC clip reports that the high value of theYen is having a detrimental effect on Japenese
exports

http://news.bbc.co.uk/1/hi/world/7870689.stm

a) What is meant by "the high value of the yen?"
b) How would this have a negative effect on the export of Panasonic products?
c) Assuming the Balance of trade/net exports worsens, explain using an AD/AS diagram what the effect will be on the Japanese economy
d) To what extent can the high value of the yen be blamed for the poor performance of Japanese exports?

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