Unit 15 - Exchange Rate Systmes And Economic Growth And Development Flashcards
Exchange rate
The external price of a currency, usually measured against another currency
Freely floating exchange rate
The exchange rate is determined solely by the interplay of demand for, and supply of, the currency
Fixed exchange rate
An exchange rate fixed at a certain level by the country’s central bank and maintained by the central banks intervention in the foreign exchange market
Currency union
An agreement between a group of countries to share a common currency, and usually to have a single monetary and foreign exchange rate policy
Indicators of development
These include gross domestic product (GDP) per head, information on the distribution of income, mortality rates and health statistics
United Nations human development index
An index based on on life expectancy, education and per capita income indicators, which ranks the worlds countries into four tiers of human development. These are;
- very high human development
- high human development
- medium human development
- low human development
Education and training
Education develops individual knowledge and intellect, while training both develops work skills. Both are necessary for economic growth and development
Corruption
A barrier holding back economic growth and development, especially in less developed economies
Institutional factors
Examples includes rules, laws, constitutions, the financial system and defined property rights
Infrastructure
For the most part, the result of past investment in buildings, roads, bridges, power supplies, fast broadband and other fixed capital goods that are needed for the economy to operate efficiently
Human capital
The skills, knowledge and experience possessed by the population
Aid
Money, goods and services and ‘soft’ loans given by the government of one country or another multilateral institution such s the world bank to help another country. Non government organisations such s I can also provide aid
