Explain how foreign exchange rates are determined. How do changes in interest rates, inflation, productivity, and income affect exchange rates? What are the advantages and disadvantages of a weak versus a strong dollar for imports, exports, international and domestic markets?
DQ 2
Who benefits from a tariff or quota? Who loses? Why would domestic markets benefit from protectionist trade policies? How do protectionist trade policies affect a government’s wealth and fiscal policy?
DQ 3
What is the effect of a trade surplus? What is the effect of a trade deficit? How do trade deficits and surpluses affect the industry in which you work?
DQ 4
Why are trade agreements important for the various countries involved? How is international trade related to the U.S. standard of living as opposed to the standard of living of a small industrial nation or a developing nation? How does international trade affect a country’s standard of living? What impact does it have on the way Americans live life, spend, consume, and so on.?
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