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Q.1) If you were the finance Minister of Never-Never Land, how would you estimate the long-run exchange rate of your currency? Defend your choice as well as discuss its possible failings.

Q.2) What are the positives and negatives of protectionist trade policies on the part of the federal government? Which policy do you think is best right now?

Q.3) How do changes in interest rates, inflation, productivity, and income affect exchange rates? Is a strong U.S. dollar always good for the U.S. and global economies? Why or why not?

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Solution Summary

Assess the validity of protectionist trade policies.

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