About This Chapter
Who's it for?
This unit of our AP Macroeconomics Homeschool course will benefit any student who is trying to learn about the categories and concepts related to foreign exchange, the balance of payments and the current account of the economy. There is no faster or easier way to learn about macroeconomics. Among those who would benefit are:
- Students who require an efficient, self-paced course of study to learn about topics such as conversion calculations, fiscal policy and trade balance.
- Homeschool parents looking to spend less time preparing lessons and more time teaching.
- Homeschool parents who need a macroeconomics curriculum that appeals to multiple learning types (visual or auditory).
- Gifted students and students with learning differences.
How it works:
- Students watch a short, fun video lesson that covers a specific unit topic.
- Students and parents can refer to the video transcripts to reinforce learning.
- Short quizzes and a foreign exchange and balance of payments unit exam confirm understanding or identify any topics that require review.
Foreign Exchange and Balance of Payments Unit Objectives:
- Learn about foreign currency exchange and the law of supply and demand.
- Discuss fixed, flexible and partially-flexible exchange rates.
- Examine the appreciation and depreciation of currency along with the implications of weak and strong exchange rates.
- Study the ways in which fiscal policy can alter exchange rates.
- Explore currency changes as they apply to imports and exports.
- Discuss trade balance and trade surplus.
- Explain each of the four major parts of the current account.
- Describe the components of the financial-capital account.
1. Foreign Currency Exchange: Supply and Demand for Currency
In this lesson, you'll learn why money from different countries has different values of exchange. We'll cover the supply and demand for currencies and how changes in supply and demand can affect the exchange rates between currencies.
2. Exchange Rate: Determination and Conversion Across Countries
Understand what exchange rates are and the different types that can be used by governments and countries. See how they operate and how the conversion process works across countries.
3. Currency Appreciation & Depreciation: Effects of Exchange Rate Changes
Find out how changes in the exchange rate can affect the economy and your own individual situation. Discover how these currency changes can increase and decrease your purchasing power and standard of living.
4. How Fiscal and Monetary Policies Affect the Exchange Rate
Discover how fiscal and monetary policy can affect the exchange rate and ultimately the amount of money it costs you to buy goods and services. Find out the three paths that both fiscal and monetary policy can travel to impact the exchange rate.
5. How Currency Changes Affect Imports and Exports
Learn about how currency changes can affect imports and exports. Find out how this affects you. Discover what happens when a dollar is strong compared to other currencies and what happens when it is weak.
6. Achieving Trade Balance: Trade Deficit and Surplus Examples
Find out what trade balance, trade deficit, and trade surplus are. Learn about some recent examples that help clarify trade deficit and surplus. Explore what countries have a surplus and what countries have a deficit.
7. Balance of Payments: Current Account & Measuring Foreign Trade
Find out what the current account is and the four main foreign trade components that it is comprised of. Similar to your bank account, learn how the current account is measured and what a deficit and surplus mean when talking about this economic indicator.
8. Balance of Payments with Financial Accounts: Measuring Foreign Trade
Learn about the balance of payments and the two key components that make it up. Discover what the financial/capital account is and how it relates to foreign trade and surpluses and deficits.
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Other chapters within the AP Macroeconomics: Homeschool Curriculum course
- Scarcity, Choice & Production Possibilities Curve: Homeschool Curriculum
- Comparative Advantage, Specialization & Exchange: Homeschool Curriculum
- Demand, Supply & Market Equilibrium: Homeschool Curriculum
- Measuring the Economy: Homeschool Curriculum
- Inflation Measurement & Adjustment: Homeschool Curriculum
- Understanding Unemployment: Homeschool Curriculum
- Inflation and Unemployment: Homeschool Curriculum
- Aggregate Demand and Supply: Homeschool Curriculum
- Macroeconomic Equilibrium: Homeschool Curriculum
- Economic Growth and Productivity: Homeschool Curriculum
- Money, Banking and Financial Markets: Homeschool Curriculum
- Central Bank and the Money Supply: Homeschool Curriculum
- Fiscal and Monetary Policies: Homeschool Curriculum
- Inflows, Outflows and Restrictions: Homeschool Curriculum