Exchange Rate Elasticity
Price transmission elasticity and exchange rate elasticity define the mechanism of international export market and changing market positions of exporting countries.
Study Guide >> Forex Market Concepts >> Exchange Rate Elasticity
3 Comments
T/F question from Series 34 that was taken 2 hours ago;
Short term the exchange rate is more inelastic than it is in the long term.
T/F
So which is it???
I would think the long term is more elastic, much like bonds…
Here we go…
“The elasticities approach is not problem-free because in the short term the exchange rate is more inelastic than it is in the long term and additional forex rate variables arise continuously, changing the rules of the game.”