Topic 3 Flashcards
1
Q
What is seigniorage?
A
the profit gained from issuing coinage (the minting of monies costs less than the actual value of the coinage)
2
Q
What are 6 determinants of exchange rates?
A
- Balance of Payments
- International Parity conditions
- Monetary approach
- Asset Market Approach
- Technical Analysis
- Efficient Market Approach
3
Q
What is the law of one price?
A
The law of one price (LOOP) says that the price of a good, when denominated in a particular currency, should be the same wherever in the world the good is being sold.
