Questions tagged [exchange]

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What defines the face value of a new currency?

When a new currency is issued, be it backed or not, its face value, i.e. the value of a single unit of the currency, has to be defined somehow. For example, when the Euro was introduced in 1999, it ...
enzo's user avatar
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Why do statista and other sources not list Bombay Stock Exchange despite its large market cap?

The wikipedia list of stock exchanges claims that both the National Stock Exchange (NSE) and the Bombay Stock Exchange(BSE) have a market cap of over 3 Trillion $. Meanwhile sources such as statista ...
whoisit's user avatar
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How do you solve this exchange economy problem using lagrange?

Consider an exchange economy with two consumers (1 and 2) and two goods (X and Y). The preferences of both consumers are represented by a utility function $U(X,Y)=\sqrt{X}+2\sqrt{Y}$. Consumer 1 ...
João's user avatar
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difference between "crawling like arrangement" and "stabilized arrangement"

What is the difference between "crawling like arrangement" and "stabilized arrangement" ? what about margins ? both less than + or -1% ?
Leila Zniber's user avatar
2 votes
5 answers
569 views

During the time of barter economy, how were less valuable and more valuable goods exchanged?

For an analogy, if I just want a loaf of bread and all I have to trade is my car or any other valuable thing.
Brandon Cunnigham's user avatar
1 vote
1 answer
162 views

How initial price of a token is determined on a centralized exchange?

Hypothetically, If I create tokens, I can create liquidity pool in one of the DEXes by adding, for instance, 1000 tokens and 1000 USDT. So the initial price of one token in this DEX will be 1 USDT. ...
Suta Purachina's user avatar
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0 answers
42 views

Market makers outside of exchanges

I found this picture on SEC of how brokers will handle their customer's orders. Why are there market maker out side of exchange? Isn’t it dealers or wholesalers that’s not approved by exchanges as a ...
Kmd's user avatar
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1 vote
1 answer
138 views

If the BOP is always equal to 0 then why would a trade imbalance cause currencies to fluctuate?

I am a bit confused in interpreting the correlation between a trade deficit/surplus & currency depreciation/appreciation. Considering BOP always equals 0 and a outflow in the current account is ...
ThomasJ's user avatar
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Price setting for a pure exchange economy, with two goods and two agents, with possible different utility functions that depends on total consumption

Consider a pure exchange economy comprised of two agents with differentiable utility functions that are strictly increasing and strictly concave. There are only two goods in this economy (x,y) and ...
moreirasd's user avatar
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1 answer
73 views

Is there an alternative to currency to facilitate exchange of goods and services?

Say I have collected a bunch of seashells. Tom wants to have my seashells. Therefore the seashells have value and I have just created wealth. And so Tom buys my seashells for \$10. But even though I ...
user2741831's user avatar
3 votes
2 answers
545 views

Is there any pressure to keep currency exchange rates around 1?

I notice that for any pair of currencies, the exchange rates seem to stay around 1 (as opposed to, say, 1,000,000). This is no longer the case if one country experiences an economic crisis that ...
LoneCodeRanger's user avatar
3 votes
1 answer
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Can stock exchange workers go on strike?

Today, trade in the stock exchange of my country Israel (TASE) was cancelled due to a union dispute. So clearly, in Israel the answer to the question in the title is "yes". I can't say this comes as a ...
Ohad Schneider's user avatar
1 vote
1 answer
31 views

How did the Exchange Rate Mechanism work?

The Exchange Rate Mechanism was introduced by the European Economic Community in 1979. It fixes the Exchange rates between currencies to a specific margin. But how does it do this?
52d6c6af's user avatar
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2 votes
2 answers
543 views

How to calculate the intercept of an indifference curve in an Edgeworth box?

Consider an exchange economy with two goods (Good 1 and 2) and two individuals ($A$ and $B$): $A$'s utility function is $u_A(x_{A_1}, x_{A_2}) = 2x_{A_1} + 5x_{A_2}$ $B$'s utility function is $u_B(...
Alex Bridges's user avatar
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1 answer
271 views

Empty edgeworth box [closed]

Can a empty edgeworth box be a pareto set? What kind of economy would be describe in this situation?
cygni's user avatar
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4 votes
2 answers
234 views

How is sending money out of a country draining its economy?

From this article: Every year, Mexicans working in the U.S. send at least $20 billion back to Mexico in the form of remittances, placing a huge drain on our economy. But I don't see what negative ...
stefan's user avatar
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1 vote
0 answers
277 views

REER ULC vs. REER PPP

Can someone give an example and an exponation of how a currency may be undervalued when considering its REER (real exchange rate) in PPP terms, but overvalued when looking at the REER based on ULC (...
Alexis L.'s user avatar
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