perfect capital mobility

Related BrainMass Solutions

• Domestic Saving and International Capital Flows

  But when the markets are open and there is perfect capital mobility across world markets, there will be no or very little correlation between the domestics savings and domestic investments.

• IS-LM-BP model of an open economy

  40257 IS-LM-BP Consider the IS-LM-BP model of an open economy with sticky price levels in local currency, perfect asset substitutability, perfect capital mobility and static expectations.

• What does this concept imply about the long-run profit opportunities from investing in international markets?

  There is perfect capital mobility and similar risks (e.g. there are no capital controls) Sources: 1. Interest rate parity http://www.answers.com/topic/interest-rate-parity-1 2.

• Fiscal Policy, Fixed Exchange Rates, and High Capital Mobility

  Second, capital account will also adjust through capital flows. High capital mobility is shown as a flatter BP curve.

• a seasonal pattern to interest rates in Hong Kong

  Assuming that Hong Kong comes about as close to the paradign for perfect capital mobility as one can get, answer the following questions: c. Might one observe a seasonal pattern to interest rates in Hong Kong ?

• Implication of monetary policy under fixed exchange-rate system on balance of payment

  Second, lower interest rate will cause capital outflows and this will lead to capital account deficit. The higher the degree of capital mobility the greater the capital account deficit will be.

• Establishment of 1231 assets

  I and II only 1231 favorable treatment was created to encourage capital mobility because it allowed capital gains treatment of assets. It also increased deductions or losses that could be claimed by the taxpayer.

• system of floating (flexible) exchange rates and high capital mobility

  300129 system of floating exchange rates and high capital mobility Under a system of floating (flexible) exchange rates and high capital mobility, is monetary policy or fiscal policy better suited for promoting internal balance? Why?

• expected rate of depreciation of the domestic currency

  
  
  - It's horizontal in the case of perfect capital mobility. In this case, if the domestic interest rate is even slightly higher than the international one, there will be a huge (infinite theoretically) capital inflow.

• how capital mobility facing an unstable county is different from England

  What factors will increase or decrease the level of international capital mobility between one nation and the rest of the world?