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  1. Appreciation:

  2. Balance of Payments Account:

  3. Balance of Trade:

  4. Balance on Current Account (current balance):

  5. Bretton Woods System:

  6. Competitive Depreciation:

  7. Current Balance:

  8. Depreciation:

  9. Devaluation:

  10. Dirty Float:

  11. Eurocurrency:

  12. European Currency Unit (ECU):

  13. Exchange Controls:

  14. Exporting Unemployment:

  15. Favorable Balance:

  16. Fixed Exchange Rates:

  17. Foreign Exchange:

  18. Foreign Exchange Markets:

  19. Free (floating, flexible) Exchange Rates:

  20. Gold Standard:

  21. Immature Creditor:

  22. Immature Debtor:

  23. Inconvertible currency:

  24. International Monetary Fund (IMF):

  25. Laissez Faire:

  26. Mature Creditor:

  27. Mature Debtor:

  28. Purchasing Power Parity:

  29. Rate-of-Return Parity:

  30. Revaluation:

  31. Tariffs:

  32. Unfavorable Balance:

Papers

Exchange Rates, International Balances, and International Finance

Appreciation:

An increase in the exchange value of a country's money in the foreign exchange market.

Balance of Payments Account:

The record of transactions affecting the international demand and supply for a nation's money.

Balance of Trade:

The amount by which the value of a country's exports of goods exceeds or falls short of the value of its imports of goods.

Balance on Current Account (current balance):

The balance of trade plus the balance on investment income plus such items as transactions in services and unilateral transfers.

Bretton Woods System:

International financial arrangements that fixed exchange rates and were built around the International Monetary Fund. It was set up just before the end of World War 11.

Competitive Depreciation:

The practice of causing a depreciation of a nation's money for the purpose of achieving an exchange value lower than  that of the monies of competing countries.

Current Balance:

See balance on current account.

Depreciation:

A decrease in the exchange value of a country's money in the foreign exchange market. 

Devaluation:

Lowering the official exchange value of a country's money. 

Dirty Float:

When individual governments try to influence the exchange value of their money by buying or selling large amounts of foreign exchange. 

Eurocurrency:

A deposit of a country's money in a foreign bank which is, therefore, free of the issuing government's regulations about reserve ratios, interest rates, and the quality of loans. 

European Currency Unit (ECU):

The monetary unit of the European Economic Community. 

Exchange Controls:

A set of regulations governing licenses required to buy foreign money and permission to buy luxury imports, to travel abroad, or to buy foreign securities or other assets. 

Exporting Unemployment:

Causing unemployment to decrease at home and increase abroad by restricting the import of foreign-made goods. 

Favorable Balance:

An active, positive, or surplus balance of trade or payments; the value of exports exceeding the value of imports. 

Fixed Exchange Rates:

Foreign exchange rates maintained through government or international monetary agency intervention. 

Foreign Exchange:

The money of other countries. 

Foreign Exchange Markets:

Markets in which the monies of different countries are exchanged (traded) for one another. 

Free (floating, flexible) Exchange Rates:

Foreign exchange rates that are free to move up or down in response to shifts in demand and supply curves arising from the ordinary operations of international trade and finance. 

Gold Standard:

A system for fixing exchange rates through a country's promise to exchange its money for a fixed amount of gold.

Immature Creditor:

A creditor country that exports enough capital to balance both return flows and continuing trade surpluses.

Immature Debtor:

A debtor country that imports goods, especially real capital goods  

Inconvertible currency:

The money of a country that does not allow it to be freely exchanged for money of other countries. 

International Monetary Fund (IMF):

An agency established just before the end of World War 11 by the major trading countries to maintain stable exchange rates and to avoid competitive depreciations and devaluations. 

Laissez Faire:

A policy of government noninvolvement in economic affairs.

Mature Creditor:

A creditor country that tends to live off its income from investments abroad. 

Mature Debtor:

A debtor country that has developed agricultural exports, which turn its trade balance positive.

Purchasing Power Parity:

When a country's money will buy as much in traded goods abroad as it will at home. 

Rate-of-Return Parity:

When the rate of return on a unit of money invested at home is the same as it would be if that money were converted into the money of a foreign country and invested there. 

Revaluation:

Changing the official exchange value of a country's money.

Tariffs:

Taxes on imported goods.

Unfavorable Balance:

A passive or negative balance of trade or payments; an excess of the value of imports over the value of exports.