Questions tagged [currency]
a generally accepted form of money, including coins and paper notes , which is issued by a government and circulated within an economy.
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How would a Central Bank Digital Currency be different from a private bank deposit?
Both are digital, both can be transferred digital, and both are denominated in the same currency. A CBDC is "a direct liability of the central bank, rather than of private banks or coin issuers&...
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Why was the massive outflow of silver before the first Opium War so bad for the British Empire?
TLDR
I am a person without any significant knowledge of economics, so even though I have (I suspect) some partial answers, I need a better understanding of these.
Background and question
In accounts ...
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Meaning of Profit
As I understand it, economics is the study of trading goods or services that are limited in capacity. If two people have something the other wants, like one person has water and the other food, they ...
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Visualizing the "Impossible Trinity"
I would like to create a data viz to show, in one chart, where some of the major economies are on the trilemma. It won't be perfect, but I'm just looking for a rough characterization. For my data viz ...
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What happened to the Iranian Rial on August 1, 2014? [duplicate]
A student of my economics class showed me an astounding screenshot that, according to Google Finance, on August 1, 2014, the IRR made a very weird spike from 0.000040 USD = 1 IRR to 24 USD = 1 IRR. ...
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Convert FAO's international dollar to current dollar
Related to Difference between the International Dollar and PPP.
I am working with FAO production matrix, and it reports production in different units:
constant 2014-2016 thousand I\$
current thousand ...
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Distinction between world reserve currency and world reserve asset
The two sound very similar, almost identical:
The dollar as a world reserve currency
The dollar as a world reserve asset
But I'd venture there are important distinctions. As an asset, the dollar is ...
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Was the council bill system used in British India a wealth extraction mechanism?
Jason Hickel says that the council bill system used to pay exporters of Indian goods during the British Raj was a mechanism by which Britain extracted wealth from India without giving India anything ...
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What factors influence the price of a good?
I assume this is a really basic question but when people start using a currency the value of which isn’t pegged to any specific substance such as gold, how does that currency evolve to correlate with ...
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Covered interest rate parity: the forward contract is not risk free
Covered interest rate parity (CIRP or CIP) can be formulated as:
$$
(1+r_{f,Home})=\frac{S_0}{F_{0\rightarrow 1}} (1+r_{f,Foreign})
$$
where $r_f$ are risk-free rates in the home and foreign countries,...
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Is there any need of digital currency given online payments through bank balance
Given talk about launch of retail digital rupee by RBI in India, is there any need for digital currency given online payments through bank balances of individuals/firms already serve the purpose?
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What happens to the currency of a war winner?
Are there examples in history that teach what happens to the currency of a war winner? Is any of this knowledge transferrable to the current situation, with either Ukraine or Russia winning the war?
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Central bank balance sheets and money supply balances
I've compared the central bank balance sheets of many countries and I've found some numbers strange for me. The balance sheet of a central bank should include all the assets on one side and all the ...
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If the value of the currency of an economy rises, then is it less desirable to trade with that economy?
I recently heard on a video that when the value of the currency of an economy rises, it is less desirable to trade with that economy. I couldn't understand it.
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How Demand of a product affects the currency
Question : Iron ore is Australia's largest export. Suppose that there was an unexpected increase in demand for Australia's iron ore exports globally. Explain what this would do to Australian Dollar ...
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How to determine exchange rate for a new currency
I have always read in present time currency exchange rate works on demand and supply
But imagine tomorrow a brand new nation with brand new currency is born
All its people are farmers and land is not ...
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What are the consequences of a single global currency on trade?
Sorry for the general nature of the question but I find it difficult to wrap my head around the idea of a global currency.
Let's say there existed a single global currency which was not controlled by ...
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Can someone explain why sterling-dollar parity is bad?
Please forgive the probable naivety of this question. I am not an economics student I am just trying to understand the currency fluctuations that are currently occurring with GBP as a result of our ...
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Options, Futures and other derivatives, book by Hull, confusion of currencies
I have a small technical problem with a book by Hull:
on the page 7, the first line, in the 11th edition of his book
Options, Futures and Other Derivatives (please see the snippet below) he writes
&...
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How did the first money owners get their money?
If certain people were the first money owners, then how did they get their money?
How could someone have paid the first money owners with money, if nobody before the first money owners had any money?
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What does THO, as in "USD THO", stand for in export statistics?
I've noticed that some online sources use "USD THO" as a unit to express rates of transfer of value. Specifically, I saw it in measuring Chinese exports to Russia in this video at 21:20 ...
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What is meant by "faith" in the context of fiat currency?
I am reading a book on how money works and it has the following definition for fiat currency: "currency with value backed by faith in the government and economy." What does that mean exactly?...
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How is a central bank able to control currency supply in an economy which has other banks and non-physical currency?
As I understand, in most economies, the central bank is supposed to be in charge of monetary policy, which in part means that they are supposed to be the only authority which can increase the amount ...
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Will the value of ruble decrease in the long term if the sanctions against Russia are not lifted?
For simplicity, let's take the example of the USD-to-RUB rate. Currently, Russia manages to maintain it at around 60 RUB per USD. However, as far as I understand it, they manage to do it by selling ...
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How can the exchange rate be virtually constant with major inflation rate difference and a widening trade deficit?
I have recently had a discussion with a colleague about what seems to be a rather strange macroeconomic aspect in Romania (which has RON currency):
EUR-RON exchange rate has been virtually a flat ...
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Perception of value between different currencies
So let's say I am going to sell a game and I'm trying to come up with a fair price.
The thing is, I am from Brazil and I'm selling in an online platform where most products are priced in dollars.
The ...
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Mechanisms to discover unbacked creation of foreign currency
Suppose there's a country called Crook Islands.
The president is John Crook, one of his sons owns a bank called Crook Island Bank domicilated on Crook Islands, and the other son is the Minister of ...
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Why does the dollar seem weak?
2:00 (GMT+8) - The FED raised interest rates at 0.75-percentage-point (75 basis points I believe, not sure with terminology but definitely now at 1.75%). But even so, why does the USD seem weaker? I ...
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Emerging Market Currencies vs. Developed Currencies during Business Cycle
Emerging market currencies usually outperform developed currencies (USD, Euro, etc.) during the late stage of the business cycle (falling growth, rising inflation) because they are much more ...
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Mistake in Wikipedia article on Fixed exchange rate system?
I think there is a mistake in the following Wikipedia-article:
https://en.wikipedia.org/wiki/Fixed_exchange_rate_system
at figure 2 and 3.
I think the ECB has to BUY (not sell) the dollars as in point ...
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Why does a stronger US dollar translate to potentially lower sales and earning for Microsoft?
A recent headline stated:
"Microsoft Corp. cut sales and earnings guidance for the fourth
quarter, citing unfavorable foreign exchange rates as the stronger
U.S. dollar takes a toll."
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Which is most accepted - USD100 or USD 100?
With or without space after currency code? I'm seeing different versions. Here it says USD 100 but here is USD100.
Which is the most accepted term?
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Currency vs purchasing power?
When I search the internet about which is the strongest currency, the answer is the currency which buys more from other currencies. For example if 1 euro can buy 10 dollars then euro is a stronger ...
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Why has the Yen weakened despite lower inflation?
I have recently wondered about the depreciation of the Japanese Yen against the USD (or any other major currency).
Currently, a thousand Yen is at around USD 7,75. This is about about a twenty-year ...
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How to reconcile 1) the International Fisher Effect and 2) rising interest rates leading to currency appreciation?
The International Fisher Effect implies that a currency with a lower nominal interest rate will appreciate against another currency with a higher nominal interest rate. However, in general, a currency ...
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Why did the Iranian Rial peak suddenly on 1 August 2014?
Search Iranian Rial and click on Max above the chart.
Iranian Rial to Pound Sterling:
Why did the Iranian Rial peak suddenly on August 1st 2014?
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Did Russia peg Rubles to a Gold Standard?
Did Russia peg the Rubles to gold? I keep reading articles on that. Are there any catches or circumstantial facts, that Russia is not on a gold based standard? Trying to verify these articles.
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What are the reasons for Russian Ruble to strengthen in the past few days?
1 USD was about 75 Russian Rubles before the war in Ukraine began. After the sanctions, Russian Ruble quickly declined and 1 USD skyrocketed to 139 Rubles. Now it is back to around 85. What are the ...
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Countries whose currencies have changed
Countries whose currencies have changed
Can you highlight the main reasons as why some countries have changed their currencies ?
What will be the impact on their economy once they change their ...
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What is the name of this economics tale about the role of money?
I recall this simple tale that summarizes the role of money in economy.
I am looking for the original reference to its text, author and initial date of publication.
A foreign merchant reaches a ...
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Why doesn't Ukrainian currency suffer from the war?
The value of the Hryvnia, has hardly been affected by the Russian invasion of Ukraine on 21 february.
https://www.google.com/search?channel=fs&client=ubuntu&q=hryvnia+to+euro
I can think of ...
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Determining a better model for for a new currency
I am in no way an economist (Just a computer programmer) and want to learn if we can use the gold standard (With improvements for using it in the Crypto domain)
For example;
If we have a physical ...
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On what basis do countries repay international loans?
Most countries have their own sovereign currency. Essentially they can print their currency. So how do countries repay their loans? And a similar question would arise while granting a loan to another ...
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What does a currency say about an economy and how to compare them?
I have a pretty basic question about comparing currencies. But I just need to have this cleared up because I can't wrap my head around it.
When I want to know for example which currency is stronger, ...
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What is fiat currency and what are its ledgers?
How are these ledgers maintained and who does it? A practical example would be very helpful.
Thank You
Edit: I was learning about the history of money and ledgers. Because Bitcoin is a ledger in the ...
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Should governments print money while the currency gets stronger
In a given situation where a local currency becomes very strong compared to other major currencies (like the USD, EUR, etc...), should the government / central bank leverage the opportunity to print ...
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Is the value of crypo currencies determined against the US dollar?
For example, for a european investor is EUR/Bitcoin implied directly from of USD/Bitcoin or are traded as 2 different markets?
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How does Distributed Ledger Technology-based Central Bank Digital Currency provide efficiency gains and serve as a contingency payment medium?
From reading Lannquist,2020, p.7, they said
DLT-based CBDC "could offer diversification in payment “rails”, providing efficiency gains or serving as a contingency payment medium."
I am ...
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Do exchange rate indicate richness/poorness of a country
Suppose there are two countries, A and B and if 1 unit of currency of A = x units of currency of B
And x>1 does that mean that country A is richer or people are well off there?
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Create currency with truly fixed exchange rate
Currency fluctuates depending on supply and demand
In fixed exchange rate, any central banks could ties their currency to another country's currency or Gold price. Which, basically, still fluctuates
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