Part 1 – Section B.2. Foreign exchange

[Hameed]

CMA1.B2.a. demonstrate an understanding of a nation’s balance of payments

CMA1.B2.b. define and identify the components of the current account, the capital account, and the official reserves account

CMA1.B2.c. define trade deficits, identify their causes, and explain their implications

CMA1.B2.d. calculate the balance of payment deficit or surplus

CMA1.B2.e. compare and contrast a flexible or floating exchange-rate system and a fixed exchange-rate system

CMA1.B2.f. graphically determine the exchange rate under a flexible exchange-rate system

CMA1.B2.g. calculate whether a currency has depreciated or appreciated against another currency over a period of time

CMA1.B2.h. infer the effect on the price of goods with a change in the exchange rate

CMA1.B2.i. calculate the effective interest rate on a foreign currency loan

CMA1.B2.j. identify the determinants of exchange rates under a flexible exchange-rate system

CMA1.B2.k. list the advantages and disadvantages of a flexible exchange-rate system

CMA1.B2.l. explain the methods used to maintain a fixed exchange rate system, including the use of reserves, trade policies, exchange controls, exchange rationing, and domestic macroeconomic adjustments

CMA1.B2.m. describe managed floating exchange rates

CMA1.B2.n. analyze the impact of changes in foreign exchange rates on a firm

CMA1.B2.o. identify mechanisms available to firms to mitigate the impact of changes in exchange rate