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Finance

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How to Calculate Cross Rates

The idea of cross rates implies two exchange rates with a common currency, which enables you to calculate the exchange rate between the remaining two currencies. [more…]

Output and Exchange Rates

Just to clarify the terminology, output refers to a country’s real gross domestic product (GDP). Because real GDP is adjusted for the changes in inflation [more…]

Inflation Rates and Exchange Rates

Most theories of exchange rate determination predict depreciation in the higher-inflation country’s currency. Inflation refers to an increase in the average price level of a country, which is frequently [more…]

What Is an Exchange Rate Regime?

The exchange rate between two currencies may be determined in international foreign exchange markets or in a government office. If an exchange rate — say, the yen–dollar rate — is determined in international [more…]

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