Term
| International Monetary System |
|
Definition
| The institutional arrangements countries adopt that govern exchange rates |
|
|
Term
|
Definition
| a system under which the exchange rate for converting one currency into another is continuously adjusted depending on the law of supply and demand |
|
|
Term
|
Definition
| A system under which the value of a country's currency is fixed relative to a reference currency and then the exchange rate between that currency and other currencies is determined by the reference currency exchange rate. |
|
|
Term
|
Definition
| A system under which a country's currency is nominally allowed to float freely against other currencies, but in which the government will intervene if it believes the currency has deviated too far from it fair value. |
|
|
Term
|
Definition
| a system under which the exchange rate for converting one currency into another is a set at a constant rate. |
|
|
Term
| European Monetary System (EMS) |
|
Definition
| System for managing exchange rates of EU currencies against each other, Now replaced by the Euro. |
|
|
Term
|
Definition
| The practice of pegging currencies to gold and guaranteeing convertibility |
|
|
Term
|
Definition
| The amount of currency needed to purchase one ounce of gold. |
|
|
Term
| Balance-of-Trade-Equilibrium |
|
Definition
| Reached when the income a country's residents earned form exports equals the money the pay for imports. |
|
|
Term
|
Definition
| System under which some currencies are allowed to float freely, but the majority are eithr managed by government intervention or pegged to another currency. |
|
|
Term
|
Definition
| A country's currency authority that holds reserves of foreign currency equal at the fixed exchange rate to at least 100 percent of the domestic currency issued in order to keep inflation down. |
|
|
Term
|
Definition
| When a speculative attack on the exchange value of a currency results in a sharp depreciation of the currency or forces authorities to expend large volumes of international currency reserves and sharply increase interest rates to defend the prevailing exchange rates. |
|
|
Term
|
Definition
| When individuals and companies lose confidence in the banking system and withdraw their deposits in what is called a "run on banks" |
|
|
Term
|
Definition
| A situation in which a country cannot service its foreign debt obligations, whether private-sector or government debt. |
|
|
Term
|
Definition
| When people behave recklessly because they know they will be saved if things go wrong. |
|
|
