ADMS 3960 Lecture Notes - Lecture 6: Option Contract, Foreign Exchange Market, Reserve Currency
9 Dec 2017
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Lecture 6 - currency, exchange rates and the internat. Receives payments for international flights from foreigners in various different currencies. Might have to pay landing fees at foreign country. Orders jersey and might have to pay suppliers in usd. Don"t buy all their merchandise in canadian dollars cus they purchase goods from all over the world and might have to pay in foreign currencies. Manufactures goods in foreign countries so have to pay workers in their home country"s currency. Value is based on the goods and services that can be bought with it. Although value doesn"t stay constant due to inflation. Inflation: sustained rise in prices measured against a standard level of purchasing power. Inflation is a phenomenon that explains why currency does not have the same value everyday or in some future time (e. g. 10 dollars in your pocket might not have the same value 6 months from now).
