equilibrium.
If joint internal and external equilibrium does not exist,
then either:
• The currency must appreciate or depreciate, or
• The central bank must intervene to stabilize the currency
• Downvaluation
-> Exchange rate increase
• IS curve will shift right.
• Buys excess foreign currency.
and Sells domestic currency.
M1, M2가 미리 결정되고(지난 기간의 선택으로)
y1은 그의 산출물이고,
그는 p1의 가격으로 화폐 1를 판매하고
t1과 t2는 추정지표로 인한 자산실현을
화폐1에 대한 지불금은 개인 1에게, 화폐2에 대한 지불금은 개인 2에게 옮긴다.
방정식 (3a)는 예산선, (3b)와 (3c)는 거래기술로 추정되는 유동성 예산선
Determination of Won/USD Exchange Rate With Respect to Global Oil Price Change
To see the relationship between exchange rate and oil price, we use econometrical methodology, multiple regression. Our regression model is this:
s_t=β_1+β_2 (m_t-m_t^* )+β_3 (y_t-y_t^* )+β_4 〖lroil〗_t+u_t
*Explanation about explanatory variable
s_t : Nominal exchange rate (USD/Won)
m_t-m_t^*
Korean economy is highly dependent on export and
it occupies more
60 percent on Korea’s GDP
▪ Finance product
▪ Contract between a bank and a company
▪ Derivative to avoid certain danger of
change under floating exchange rate system
The government has decided to link
the value to another currency or
to some valuable commodity like gold
Do not ch
2. Policy Analysis with Partial Capital Mobility
• Expansionary fiscal policy, fixed exchange rates
IS curve shifts right, Y and R increase.
Higher R increases foreign capital inflow.
• Creates BP surplus and upward pressure on currency.
Central bank intervenes in the foreign exchange market.
• Buys excess foreign currency.
Incr