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it should reference economic logicnot only the relevant calculations.

01 / 10 / 2021 Questions

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The Central Bank of Rushia has decided that it would like to establish a fixed rate for the Rushian Dollar and peg it to the Euro. The Central Bank of Rushia intends to target a fixed exchange rate of 1.25 per Rushian Dollar.Describe the required intervention by the Central Bank of Rushia (CBR). Make sure to address the following questions: 2) how many Rushian Dollars should the CBR purchase or sell on the foreign exchange market?, 3) will the Rushian Dollar appreciate or depreciate against the Euro, and by how much?, and 4) will the Euro appreciate or depreciate against the Rushian Dollar, and by how much? Your answer should explain how you identified these effects, and it should reference economic logicnot only the relevant calculations.



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