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Under-valuation or Overvaluation of currency could be with respect to goods and services
Taking for instance US, over valued US dollars would mean that buying goods and services in the US will be more expensive when compared to what the same dollar amount would fetch for goods and services in China (where currency is undervalued). A tourist would have more bargain for his bucks shopping in China than in the US.
Also, the effect of this is that cost of production in the US would be high and manufacturers would only make little profits from exports/sale of its goods and services. Conversely, in China, the undervaluation of their currency allows for cheap production of goods and expansion of their export market.
What else can I help you with?
Why might some countries be reluctant to adopt a common currency?
The most important reason is concern that the value of the currency will be more easily affected by factors outside the country's control.
Can anybody really know what the value of currency is?
Generally, yes, because most countries use flexible exchange rates and so arbitrage ensures that the value of a currency is determined accurately (i.e. if the currency was overvalued for some reason, experienced for-ex traders would realise and cause it to fall). If the exchange rate is fixed you can't tell if it's valued correctly because it is usually pegged on another exchange rate (so if the other currency depreciates the government will make sure that their currency depreciates). This means that the value of the exchange rate doesn't reflect what is going on in the economy, it reflects what is going on in the other economy.
Can money expire, and if so, what are the implications of expired currency?
Yes, money can expire in some cases, such as when a country introduces a new currency and sets a deadline for exchanging the old currency. The implications of expired currency include loss of value, inability to use it for transactions, and potential financial losses for individuals holding the expired currency.
What are some examples of CAPM questions that test understanding of the Capital Asset Pricing Model?
Some examples of CAPM questions that test understanding of the Capital Asset Pricing Model include: Explain the concept of systematic risk and how it is measured in the CAPM. Calculate the expected return on a stock using the CAPM formula. Discuss the assumptions underlying the CAPM and their implications for its applicability in real-world scenarios. Compare and contrast the CAPM with other models used to estimate the expected return on an investment. Analyze a scenario and determine whether a stock is undervalued or overvalued based on its expected return calculated using the CAPM.
When is a currency pegged to another currency?
Countries try to stabilize their export competitiveness by living under a fixed exchange rate regime sometimes called a pegged currency or exchange rate. The central bank has to sell or buy its own currency to stabilize its external trading value against the currency of its trading partners. China, also it unpegged its currency recently back in 2008, had for over 20 years a pegged currency to the US$. Since China had over many years a trade surplus it was buying US Treasury bonds in order to avoid that its currency would appreciate as a theory of purchasing power parity theory would predict. This led to the fact that China is holding over 2,000 billion US$ worth of currency reserves right now, half of it denominated in US$. Pegging a currency has advantages and disadvantages. The key advantages are that you can maintain your competitiveness in exports and reduce the overall risk of doing international business on the other hand a fast growing country has a hard time to constantly sterilize the influx of funds through trade and speculator while keeping interest rates artificially low. Which leads to asset bubbles that finally burst at some time in the future which will conexant periods of higher inflation followed buy a bust in equity markets or real estate. Another disadvantage is if countries do not have enough funds to defend their currency during a speculative attack if it is overvalued due to the fact that the currency is pegged. That leads to rapid depreciation and a deep recession, the last Asian crises from 1998 was a good example of that.
What are some of the most undervalued stocks?
There are many stocks that are heavily undervalued. Some examples of these stocks include Anadarko petroleum, Devon Energy, Pioneer, Amgen Inc, and Precision Castparts.
Can you give me some hot tips regarding undervalued stock?
what is a broker?
Why would a person need to buy foreign currency?
If you are travelling to a country that has a different currency than your own, then it is a good idea to get some money transferred into the currency of the country you are travelling to so that you are able to buy things there.
Why some country currency have much value and some country haven't?
because some currency is used more than others. The U.S dollar for example, is used in more than just the U.S. It used to be used in europe, canada, and all over the world. But since europe's currency is being used more, there currency is worth more than the U.S
Do all countries have paper money?
No. Some use currency from another country.
What is the value of 1 peseta?
It is 1 peso! And if you wanted to know its value in some other currency then you need to specify which country's peseta you are talking about and also in which country's currency you want its value.
What is the value of 1 peso?
It is 1 peso!And if you wanted to know its value in some other currency then you need to specify which country's peso you are talking about and also in which country's currency you want its value.
What is the name of Latin America's Currency?
There is no currency which is used throughout all of Latin America. The currency used varies by country.
What is a cash converter used for exactly?
A cash converter is used to convert one country's currency to another country's currency. Most of them charge a small fee, but if you're planning on purchasing anything in the country you are entering, you must exchange some of your money.
How much a one dollar?
Obviously, one dollar in the US. I can only assume you wish to know what it is worth in some other country's currency, but you have not given a clue what country that would be. You can use a currency conversion website like the related link to convert it into any currency in the world.
What is the currency during the American occupation?
The dollar is usually instituted when American occupies a country, though in some instances the occupied nation is allowed to retain national currency.
How much is a one-dollar-bill worth?
Obviously, one dollar in the US. I can only assume you wish to know what it is worth in some other country's currency, but you have not given a clue what country that would be. You can use a currency conversion website like the related link to convert it into any currency in the world.
