1. Discuss the role of a financial system in an economy and why are financial markets important to the health of any economy? 2. How would a drop in the value of the Fijian dollar affect Fiji...

1. Discuss the role of a financial system in an economy and why are financial markets important to the health of any economy?
2. How would a drop in the value of the Fijian dollar affect Fiji consumers?


COLLEGE OF BUSINESS, HOSPITALITY AND TOURISM STUDIES DEPARTMENT OF ECONOMICS & CUSTOMS ECN701 MONETARY ECONOMICS Semester 1, 2020 Topic 1 Tutorial Concepts: 1. Discuss the role of a financial system in an economy and why are financial markets important to the health of any economy? 2. How would a drop in the value of the Fijian dollar affect Fiji consumers? Applied: 3. The following table lists foreign exchange rates at BSP between the Australian dollar (AUD) and Fijian dollar (FJD) for the month of November 2019. Date AUD per FJD Notes Buy Notes Sell 1/11 0.7110 0.6573 2/11 0.7360 0.6823 3/11 0.6861 0.6324 6/11 0.7460 0.6923 7/11 0.6989 0.6452 8/11 0.6873 0.6336 9/11 0.7226 0.6689 10/11 0.7469 0.6932 13/11 0.6660 0.6123 14/11 0.6582 0.6045 15/11 0.6536 0.5999 16/11 0.6723 0.6186 17/11 0.6775 0.6238 20/11 0.7106 0.6569 21/11 0.7326 0.6789 22/11 0.7429 0.6892 23/11 0.7534 0.6997 27/11 0.7560 0.7023 28/11 0.7689 0.7152 29/11 0.7460 0.6923 30/11 0.7172 0.6635 (i) Which day would have been the best day for converting $300.00 FJ into Australian Dollar? (ii) Which day would have been the worst? (iii) What would be the difference in Australian Dollars (AUD)? ENDS