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The Australian Exchange Rate
By: Dontae Smith
Introduction: What factors affect the demand and supply of Australian dollars in the foreign exchange markets? Distinguish between the possible causes and effects of currency depreciation and a currency appreciation on the Australian economy. What forces have come into play, if any, in the past four months that have affected the value of the Australian dollar?
Exchange Rate: "The rate at which one unit of domestic currency is exchanged for a given amount of foreign currency"
A BRIEF HISTORY OF THE AUSTRALIAN DOLLAR
Until 1971, the Australian dollar (AUD) was "pegged" to the British pound. This meant that the AUD rose or fell in line with the pound. In 1971, the AUD became pegged to the US dollar instead. These currencies were fixed currencies, which meant that the Australian currency would only change value when a major world currency also changed. This system lasted only until 1974 when the AUD became pegged to a trade-weighted......
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Title: The Australian Exchange Rate
Approximate Word Count: 3193
Approximate Pages: 13 (250 words per double-spaced page)
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