ECS3703 Assignment 2 Semester 1 Memo | Due April 2025

R100.00
0 Downloads

ECS3703 Assignment 2 Semester 1 Memo | Due April 2025. All questions fully answered. QUESTION 1 [40 MARKS] Assume that Sub-Saharan African countries are small countries with perfect capital mobility and a desire to maintain a balanced current account and correct unemployment or inflation. (a) Explain which macroeconomic policy these countries should use to achieve this under a scenario of a flexible and fixed exchange rate systems and why. ……………………………………………………………….……….………(10) (b) With the aid of diagrams, briefly explain how the governments of Sub-Saharan African countries can use the relevant policies mentioned in (a) under each scenario ………………………………………………………………………………(20) QUESTION 2 [10 MARKS] Discuss the Optimum Currency Area (OCA)……………………………………………(10)

Description

ECS3703 Assignment 2 Semester 1 Memo | Due April 2025. All questions fully answered. QUESTION 1 [40 MARKS] Assume that Sub-Saharan African countries are small countries with perfect capital mobility and a desire to maintain a balanced current account and correct unemployment or inflation. (a) Explain which macroeconomic policy these countries should use to achieve this under a scenario of a flexible and fixed exchange rate systems and why. ……………………………………………………………….……….………(10) (b) With the aid of diagrams, briefly explain how the governments of Sub-Saharan African countries can use the relevant policies mentioned in (a) under each scenario ………………………………………………………………………………(20) QUESTION 2 [10 MARKS] Discuss the Optimum Currency Area (OCA)……………………………………………(10)