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Professor Dave Explains
Exchange Rates and Trade
We've talked about free trade, but one issue is that different countries utilize different currencies, and the values of those currencies are constantly fluctuating. The value of one currency with respect to another is called an exchange...
Khan Academy
Floating Exchange Resolving Trade Imbalance
In a hypothetical global trade scenario, Sal lays out an import-export relationship between the United States and China. Through supply-and-demand logic, he describes a situation where the US dollar would weaken, and the Chinese Yuan...
Khan Academy
Khan Academy: Chinese Currency and u.s. Debt: Floating Exchange Effect on China
Examines what the effect on China would be of a floating exchange rate. [3:26]
Khan Academy
Khan Academy: Chinese Currency: Floating Exchange Resolving Trade Imbalance
Explores how a floating exchange rate could in theory resolve a trade imbalance. [4:06]