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BoP Theory of Exchange Rate Determination

The BoP Theory of Exchange Rate Determination is a modern theory for exchange rate determination. BoP Deficit = appreciation of […]

According to this theory, the exchange rate between the currencies of any two countries is calculated by comparing their purchasing

It is also called Factor Proportions Theory, or Heckscher–Ohlin Theory. It was developed by Swedish economists Eli Heckscher and Bertil

Elasticity Approach to BoP (Price Effect or Micro Effect) Devaluation & Revaluation – by policy adjustment by the government Depreciation

Causes of BoP Deficit (BoP Disequilibrium) The BoP deficit or Balance of Payment Disequilibrium occurs due to various factors, which

The effectiveness of fiscal and monetary policy depends upon the exchange rate system of the economy. If the exchange rate

What is Dumping? Dumping is a practice of selling the product at a lower price in the foreign market than

What is Factor Pricing? Factor Pricing refers to the determination of the reward or payment given to the factors of

In the previous post, we explained the causes of the BoP Deficit in Nepal. Now, we talk about how to

What is Balance of Payment (BoP) A balance of Payments is a systematic record of a country’s economic transactions with

What is an Oligopoly Market? It is the market structure where there are few sellers (two or more), a limited

Nepal initiated to promote foreign investment formally by the enactment of the Foreign Investment Act 2038 BS. Probably it was