1. AP ECONOMICS: November 14
Warm-up
EX 1: Interest rates: 4% in U.S.; 6% in Canada. Show the impact of the relative interest rates on the D for USD and the S of CAD
EX 2: show how a decrease in U.S. imports from Mexico (due to U.S. tariffs) would impact the value of the MXN and value of the USD
Learning Target In order to understand how an open economy interacts with the rest of the world, I will learn how transactions in the financial markets and product markets impact exchange rates. I will know I have it when I can draw FOREX market graphs showing the impact of flows of items between countries and explain the impact of changing exchange rates on exports and imports.
FOREX Market Live Quotes
Worksheet: Graphing Exchange Rates (HO)—go over #1 and #2
Note 1: impact on balance of trade means impact on exports and imports
(if X>M then trade surplus; if X<M then trade deficit)
Note 2: FOREX market curves: questions often worded where both S and D shift right questions could be worded where S and D shift left
FRQs #8 & #9 are TUESDAY
Short FRQ—Phillips Curve Long FRQ—all graphs are fair game as well as monetary and fiscal policy MCT #5 is WEDNESDAY
Note: You may use an index card on FRQs containing the basic set ups of graphs and curve shifters