1.What is meant by exchange-rate overshooting? 2. What does the Dorn busch overshooting theory assume about the speed of adjustment of different prices? 3. What happens in the Dorn busch overshooting...

1.What is meant by exchange-rate overshooting? 2. What does the Dorn busch overshooting theory assume about the speed of adjustment of different prices? 3. What happens in the Dorn busch overshooting theory to interest rates after exchange rates have overshot their eventual equilibrium? 4. Why does the monetary approach imply that higher expected inflation causes a currency to depreciate?