International Currency And International Trade

Well it’s not good special for international student, we have to change more in our currency money to be US dollar. When U.S dollars stronger than national currency, import are less expensive. So American people can buy products good and services cheaper. In face it will lead to increase demand for the currency needed to purchase products and imported products because you can buy more products or the product is cheaper and it increase the economies in US. For example, we order clothes from china the same amount of money, we can buy more cloth and we won’t have to spend many money to do it. But for the business local currency becomes weak and down in valve, then the products in US are importing become more expensive. Also increase in the demand on the foreign change market more increases the price of its currency, Other country become demanding more US Dollars in order to pay for these services and commodities. International labor increase more if US dollars more strong so They can change US dollars more money in their countries, Changes in nationwide incomes in foreign countries as well as in the United States. On other hand export less because US dollars strong and other countries decrease demand products from US because US products good is more expensive. Also people buy foreign products rather than domestically produced goods and become to effect to US export. It capacity make business

B the permanent movement of funds from one currency to another in the hopes of profiting from long. term investment in a particular country.

Reduced trading costs with cooperation countries, better communication through trade, larger competition for similar companies, more choices for consumers, and a greater sense of global community.

· What happens when there is a surplus of imports brought into the U.S.? Cite a specific example of a product with an import surplus, and the impact that has on the U.S. businesses and consumers involved. When there is a surplus of imports brought into the U.S. it means that the price of the product(s) will drop. U.S. companies that are competing with the Chinese made products will suffer from price drops of the goods. With consumers it will benefits the consumer with the lower price on goods. Large screen LCD/HDTV is a good example. Since the recession there has been a surplus of large screen HDTV. Not many people can afford or buy them since the prices were high. Now large screen LCD/HDTV is much cheaper than what it was 4 years ago.

None of the currency’s talked about in the article are effective ways of regulating trade. For example, salt being used as a currency would allow anyone to go and mine salt therefor circumnavigating the entire department of treasury, and almost equal to copying the dollar bill. For another example, knives

lower the value of a nation 's currency by increasing the precautionary demand for money

In a world governed by the rule of currency has major effect toward the amount an individual owns. In the world economy labor is required in order to supply services to whomever is willing to buy. The amount of money distributed and earned throughout the economy feeds the nation 's GDP which shows the stability of the overall economy of that nation. There is an imaginary cycle that must be established in an economy in order to balance both labor and revenue in order to stabilize a country economy.

According to Google Dictionary.com International Economics is a money-based study of how one nation is bought by another nation and how the currency of one nation is exchanged for the currency of another nation to pay for this production.

The advantages and disadvantages depend on what side of the economic spectrum you sit on Keynesian or classical.

In 2008, world economic downward has greatly impacted Iceland’s economic. The three biggest banks in Iceland were bankrupt because they were not able to pay the debts. As a result, Iceland banking system collapsed (Holmes & McArdle, 2008). Noted that, most world financial institutions decided to drop Iceland’s credibility. And loan from international market and investment were significantly dropping in Iceland’s financial market. It leaded Iceland’s kroner to become very unattractive. To regain and reconstruct Iceland’s financial system, using Canadian Dollar as its official currency is fundamental since Canadian Dollar is creditable and steady currency.

Reserve currency is the currency in which large amounts are held by governments or financial institutions as part of their foreign exchange reserves. US dollars play important role in the international monetary It has an effect on global financial markets and government central banks. Reserve currencies are used in international transactions. Citizens of a country that produces a reserve currency can buy imports, cross-border borrowing more and at a lower cost than nationalities of other countries because they do not need to make a currency change. commercial banks around worlds do a lot of their business on the dollars. it gives the countries that opportunity to take the deposit in dollars, extend land also it helps when they have financial

Consequences regarding the international businesses and the flow of trade and investment among the three countries are given below as benefits and drawbacks of holding fixed exchange rate system-

International tourism contributes to foreign exchange earnings. Tourists usually come to the country of destination with strong, stable, and expensive currency, such as dollar or euro. Then, they exchange it according to the internal rate of the country they stay in. Considering the number of tourists that travel to the same destination, which in some countries can be very large, we can estimate that the amount of foreign currency they leave there is hundreds times larger. Therefore, a host economy benefits from the inflow of foreign currency.

The international trade of goods across the world accounts for approximately 60% of the world Gross Domestic Product (The World Bank, 2014). A great proportion of goods transactions occur every second. The primary question is whether international trade benefits a country as an entirety, and, if so, why would a country implement protective trade policies to restrict particular exports? To address this question, this essay aims to explore the impact of trade on various economic stakeholders, including consumers, producers, labour and government and, furthermore, will compare models and theories with reality to ascertain the true winner/ loser in the international trade market.

Adam Smith outlined that the price mechanism in international trade is like an ‘invisible hand’ that coordinates the consumption and production decisions in a well-functioning market economy (Kerr and Gaisford 2007). However, there is need for the government to intervene in free market economies in order to implement trade regulations and avoid market failure that is associated with negative externalities. International trade is affected by government’s interventions that include direct participation in supply and purchase of essential goods and services, through regulation, taxation and other indirect participation influences. The free markets enhance market efficiency through ensuring that prices are determined by the