a.) Fluctuating/flexible /floating /exchange rate systems
This is a situation where there is a free and competitive foreign exchange market. The foreign exchange value of a country’s currency depends on:
-The country’s balance of trade.
- The capital transactions with the rest of the world.
- Actions of speculators
b.) Fixed exchange Rates
Under this system the values of currencies are fixed in terms of a common denominator
c.) Adjustable peg system
This is where flexibility in exchange rates is managed.
Current trade in international trade
a.) Liberalization
This is the removal of trade barriers amount countries so that each country can freely trade with others
b.) Websites
This is the store of information within the internet where one can get access to it by use of a computer.
c.) Export processing zones (EPZ)
These are areas set aside by the government where industrialists can set up firms to process goods for export at or no little charge.
Advantage of EPZ
- Encourages foreign investors into the country.
- Create jobs opportunities.
- Stimulate industrialization.
- Earn the government some revenue after the tax free period.
- Encourages exports due to the incentives given by the government which in turn helps to correct unfavorable balance of payments
Disadvantages
- Encourages social evils such as prostitution.
- Using employ foreigners in management positions.
- Do not generate revenue for the government during the tax free period.
- Concentrated only in a few towns which brings about imbalanced regional development
sharon kalunda answered the question on February 22, 2019 at 13:51
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