Spot Rate, Forward Rate, and Forward Premium/Discount
A spot exchange rate is the general price level in the market used to directly trade one currency for another, with the exchange occurring at the earliest possible time. The standard delivery time for spot currency transactions is no longer…
The Bid-offer Spread
An exchange rate is the price of the base currency expressed in terms of the price currency. For example, assume that the USD/CAD rate is 0.7625. This implies that the Canadian dollar, the base currency, costs 0.7625 US dollars (One…
Effects of Demographics, Immigration, and Labor Force Participation on the Rate and Sustainability of Economic Growth
Labor Supply The production function shows that economic growth is mainly affected by increased labor and capital. The size of Labor is measured using the total number of hours available for work. The labor force is the proportion of the…
Effect of Natural Resources on Economic Growth
A simple form of the production function, which concentrated on labor and capital inputs, was used in the previous reading. The production function can be extended to include other factors of production, such as: Human capital (H). Raw materials (N)….
Study Notes for CFA® Level II – Economics – offered by AnalystPrep
Reading 8: Currency Exchange Rates: Understanding Equilibrium Value -a. Calculate and interpret the bid-offer spread on a spot or forward currency quotation and describe the factors that affect the bid-offer spread; -b. Identify a triangular arbitrage opportunity and calculate the…
