A peg is not credible when investors fear depreciation in the future, despite official;announcements. Why is the home interest rate always higher under a noncredible peg;than under a credible peg? Why does that make it more costly to maintain a noncredible;peg than a credible peg? Explain why nothing more than a shift in investor;beliefs can cause a peg to break.
Paper#30775 | Written in 18-Jul-2015Price : $42