Wednesday, September 15, 2010

Unit 2: How to alter your exchange rate

This BBC clip explains how the Japanese cental bank intervened in the market to force down the value of the Yen

http://www.bbc.co.uk/news/business-11310620

a) Why did the central bank intervene?
b) Using a S&D diagram, explain how they manipulated the value of the Yen downwards (ie a depreciation)

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