The Grubel-Lloyd index is used to measure the degree of intra-industry trade, Interpret what an index of zero (0), one (1) and zero to one (0 < GL > 1) indicate.
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The Grubel-Lloyd index is used to measure the degree of intra-industry trade, Interpret what an index of zero (0), one (1) and zero to one (0 < GL > 1) indicate.
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Describe the difference between Krugman's interpretation and Ethier's interpretation of intra-industry trade.
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- A company manufacturers a product in the United States and sells it in England. The unit cost of manu-facturing is $50. The current exchange rate (dollars per pound) is 1.51. The demand function, which indicateshow many units the company can sell in England as afunction of price (in pounds) is of the power type, withconstant 27556759 and exponent 22.4.a. Develop a model for the company’s profit (indollars) as a function of the price it charges (in pounds). Then use a data table to find the profit-maximizing price to the nearest pound. b. If the exchange rate varies from its current value, doesthe profit-maximizing price increase or decrease?Does the maximum profit increase or decrease?If the direct quote for a U.S. investor for British pounds is $1.43/£, then the indirect quote for the U.S. investor would be ________ and the direct quote for the British investor would be ________. A) £0.699/$; £0.699/$ B) $0.699/£; £0.699/$ C) £1.43/£; £0.699/$ D) £0.699/$; $1.43/£ E) None of the AboveIf your company are involved in business of import and export of electronics, the transaction would be recorded in the current account subcategory of ___________ * Current Transfer Service Trade Income Trade Goods trade
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- Mary Argent is a foreign exchange trader for a bank in New York. She has Si million (or its Swiss franc equivalent) for a short term money market investment and wonders if she should invest in U.S. dollars for three months, or make a covered interest arbitrage investment in the Swiss franc. She faces the following quotes: $1,000,000 1.2810 Arbitrage funds available Spot exchange rate (SFr./S) 3-month forward rate SFr./$) U.S. dollar 3-month interest rate Swiss franc3-month Interest rate 1.2740 4.800% 3.200% She should Borrow: A 780,600 SF franes (SWISS) B. 1.281.000 USD (US dollars) C. 1.281.000 SF franes (SWISS) D. TBO.000 USD (US dollars)A British company that exports shoes to Switzerland wants to exchange the Swiss franc (SF) for British pounds. If the US Dollar Rate of the two currencies is disclosed as follows: £0.5120-0.5130/US$, SF1.1230-1.1240/US$ Calculate and disclose the purchase/sale exchange rate between the two currencies as £/SF by the Cross Rate. If the export price received by a British company is SF10,000, what is the amount of British pound after the exchange?7 has globalization changed given the current situation we are experiencing due to COVID-19? please explain your reasoning in detail.
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