Foreign Exchange Market (Part 2) | International Business | From A Business Professor
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- Опубліковано 28 лип 2024
- In the previous video, we discussed what the foreign exchange market is. What are the major functions and features of the global foreign exchange market? In this video, we will continue the discussion and focus on the major economic theories of exchange rate determination.
A personal understanding that I gained from this information video was The Law of One Price, meaning the price of the same goods in different markets should be the same when the price is expressed in terms of the same currency. This definition alone provided a better understanding of this topic.
The law of one price is explained so well. The Big Mac Index was interesting. Inflation was touched on and I now understand it better than ever. Interest rates are going up in US and explaining that all time high inflation is happening.
The Big Mac index was very new to me; it makes sense utilizing it as a way to estimate where there is fair value, overvalued, or undervalued currency exchange. The explanation was simple and easy to grasp.
I found this video very help especially because of the time we are living in now, which is inflation! This video helped explained why prices are going up at grocery stores, gas stations, and even looking for apartments. This also helps why people say it is not good to buy a home during this time due to interest rates being really high
Again, I did not know most of the information in this video. I am glad it talked about inflation because it was always something I was curious about and always heard about but never fully understood how it works.
IFE was something I struggled with but your video really helped me understand, and its cool to see the comparison of one countries currency appreciating or depreciating against anothers.
I appreciate how this video went into the market, it was very well explained. It was also very beneficial to learn about inflation, especially since that is the thing that I feel like is impacting us the most at the moment. I also loved learning about the Big Mac Index. I feel like it explains the value of money well and it is memorable enough that it will stick with me.
This is the first I heard of the Big Mac index. Yet I have done this in a sense multiple times. Whenever I go to Mexico I always compare the the purchasing power of the US dollar compared to pesos.
The Big Mac Index is a useful tool for comparing the values of currencies. I wonder if holding savings in a foreign bank with a high interest rate is worth the risk.
Its hard to know which theory to use to predict the short-term run changes in exchange rates due to all of the mini implications such as bandwagons and investor expectations that can effect these changes
I thought that this video did a good job on explaining the Foreign Exchange Market, as it is a topic that can be difficult to completely understand.
Economics is so confusing. The more I try to understand it the more I'm confused.