Interest Rates in an Open Economy

Abstract: This 4 page paper answers questions set by the student, looking at issues concerning interest rates in an open economy. The first question looks at what is meant by capital mobility and the concept of perfect and imperfect mobility. The way in which discrepancies between international and domestic interest rates may impact on the balance of payments is discussed and the potential advantages and disadvantages of increasing rates in the US at the beginning of 2011 are considered. The bibliography cites 4 sources.

Filename: TEopenint.doc

Pages: 4

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Catagory: Money & Banking / Corporate Finance

Subcatagory: Accounting & Personal Finance

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