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    ok another question,

    what on earth is free trade?? has it anythign to do with economics?
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    (Original post by Fly By)
    ok another question,

    what on earth is free trade?? has it anythign to do with economics?
    gee that was sweet of u!
    free trade is when there is trading between countries with no barriers to trade i.e no import tarrifs or quotas etc etc
    all countries trade no restrictions
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    What effect does a rise in the interest rate of a country have on the said countries international trade?
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    (Original post by kriztinae)
    gee that was sweet of u!
    free trade is when there is trading between countries with no barriers to trade i.e no import tarrifs or quotas etc etc
    all countries trade no restrictions
    like the european union?
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    (Original post by risk-is-good)
    What effect does a rise in the interest rate of a country have on the said countries international trade?
    ok wait ur question doesnt make sence but maybe this helps
    if u increase interest rates it will increase the value of ur currency as more people are demanding ur currency but this makes imports for ur cutizens cheaper but ur exports will be more expensive for other countries, this creating a balance of payment defecit
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    (Original post by kriztinae)
    ok wait ur question doesnt make sence but maybe this helps
    if u increase interest rates it will increase the value of ur currency as more people are demanding ur currency but this makes imports for ur cutizens cheaper but ur exports will be more expensive for other countries, this creating a balance of payment defecit
    Sorry for wording it strange. Anyway, that it the answer I was looking for!
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    (Original post by kriztinae)
    ok wait ur question doesnt make sence but maybe this helps
    if u increase interest rates it will increase the value of ur currency as more people are demanding ur currency but this makes imports for ur cutizens cheaper but ur exports will be more expensive for other countries, this creating a balance of payment defecit
    ahhhhhhhhh!

    what is inflation/deflation? and what are its affects...
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    (Original post by Fly By)
    like the european union?
    sort of but the EU is like a customs union
    its more than a free trade area
    free trade does occur in the EU but along with free trade there is a common external tarrif, that is a tax on anythin comin from outside the EU, but the tax has to be the same for all member countries,
    if its not the cuntry outside the EU say china can import its good into the country with the cheapest tax rate and then import it taxfree to ny other country in the EU
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    (Original post by Fly By)
    ahhhhhhhhh!

    what is inflation/deflation? and what are its affects...
    inflation is when the price of all goods and services increase over a period of time. seen as undesirable to have high rates but a country wants 2-3% inflation to show that economic growith occurs. when inflation occus the value of money decreases
    effects arg too many to list.....
    deflation is the oposite of inflation. you get deflation when the country is in recession. sometimes its good sometimes its bad, here the value of money increases
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    (Original post by risk-is-good)
    Sorry for wording it strange. Anyway, that it the answer I was looking for!
    ok great!
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    can someone explain foreign currency reserves?
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    (Original post by TheWolf)
    can someone explain foreign currency reserves?
    well each country likes to keep foreign currency reserves, im guessin ur askin why they keep them!
    well instead of using interest rates to alter the value of ur currency, u can use foreign currency reserves, i.e if ur currency is going down u can sell foreign currency and buy up more of ur currency to appreciate its value,( in the same time u can affect the value of the other countrys curency!)
    also when ur curency is appreciating too much u can sell off ur currency and buy up other countrys currency for a time of need!
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    doesnt anyone have any more questions!!??
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    (Original post by kriztinae)
    doesnt anyone have any more questions!!??
    lol, you're too good!!

    umm..let me think.....
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    (Original post by kriztinae)
    doesnt anyone have any more questions!!??

    yea ive got a question how do you work out the index of inflation>?
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    who is christina?
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    (Original post by Tinykates)
    who is christina?
    shes answering all the questions
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    (Original post by TheWolf)
    yea ive got a question how do you work out the index of inflation>?
    hmm this is a bit more complicated, bear with me!
    ok well u take the base year as being 100
    when u have inflation of 10% then the index for year 2 is 110
    the next year u have inflation of 5% the index will be 5/100 x 110 = 115.5
    etc got it?
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    (Original post by Tinykates)
    who is christina?
    me me me! im sort of revising and helping anyone with ny questions about economics!
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    (Original post by Fly By)
    shes answering all the questions
    oh....kriztinae
 
 
 
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