Product details

By continuing to use our site you consent to the use of cookies as described in our privacy policy unless you have disabled them.
You can change your cookie settings at any time but parts of our site will not function correctly without them.
Structured assignment
-
Reference no. 205-116-4
Published by: IBS Research Center
Published in: 2008

Abstract

This structured assignment is to accompany the case ''205-116-1''. The abstract of the case is as follows: The government of Hungary set 1 January 2008, as the deadline for joining the European Monetary Union (EMU). One of the main conditions was to reduce inflation, which was substantially higher than other European Union countries. Checking inflation by increasing the rate of interest caused the forint, Hungary''s currency, to soar, resulting in poor export performance and consequently widening trade deficit. On the other hand, continuous budget deficit also resulted in a rise in price level. The case examines the interaction of macro-economic variables in detail, in the context of: (1) inflation; (2) rate of interest; and (3) exchange rate mechanism. It also speculates on what would be the right path for Hungary to join the EMU.
Location:
Other setting(s):
2005

About

Abstract

This structured assignment is to accompany the case ''205-116-1''. The abstract of the case is as follows: The government of Hungary set 1 January 2008, as the deadline for joining the European Monetary Union (EMU). One of the main conditions was to reduce inflation, which was substantially higher than other European Union countries. Checking inflation by increasing the rate of interest caused the forint, Hungary''s currency, to soar, resulting in poor export performance and consequently widening trade deficit. On the other hand, continuous budget deficit also resulted in a rise in price level. The case examines the interaction of macro-economic variables in detail, in the context of: (1) inflation; (2) rate of interest; and (3) exchange rate mechanism. It also speculates on what would be the right path for Hungary to join the EMU.

Settings

Location:
Other setting(s):
2005

Related