1. List the 10 most important currencies in the world today in the order of importance. Indicate basis for listing. Project 10 years ahead.
The ten most important currencies in the world in 1999, in order of importance, are as follows: the United Stares dollar, the German mark, the Japanese yen, the United Kingdom pound, the Swiss franc, the French franc, the Canadian dollar, the Italian lira, the People's Republic of China huan, and the European Community euro. All except the People's Republic of China huan, the Swiss franc, and the European Community euro are important because they are the national currencies of the G-7 nations. Additionally, the United States dollar is the primary reserve currency on a global basis, while the German mark, the Swiss franc, the United Kingdom pound, and the European community euro also are held as a reserve currency. The Japanese yen also is important as the economy of Japan is the second largest national economy in the world. The People's Republic of China huan is important because of the role that country plays in the economy of Asia and the role that China is expected to play in the global economy in the future. The euro is important because of the role it is expected to assume as the single currency for most member countries of the European Community. The ten most important currencies in 2009 likely will be different from the ten most important in 1999 primarily because of the euro. My list for the top ten currencies in 2009 is as follows: the United States dollar, the European Community Euro, the Japanese yen, the Swiss franc, the People's Republic of China huan, the Canadian dollar, the Brazilian cruzero, the Australian dollar, the Indonesian rupiah, and the Russian ruble.
2. What is the relationship between a country's currency and its import or export potential. How do Indonesia and Mexico stack-up? Why?
All other factors remaining equal, a stable currency is conducive to...