Case Study
China's Managed Float. Read the case and answer the questions at the end of the case.
This should be in APA format with about 6-7 pages
Casa Discussion Questions
1. Why do you think the Chinese government originally pegged the value of the wan against the U.S. dollar? What were the benefits of doing this for China? What were the costs?
2. Over the last decade, many foreign firms have in¬vested in China and used their Chinese factories to produce goods for export. If the yuan is al¬lowed to float freely against the U.S. dollar on the foreign exchange markets and appreciates in value, how might this affect the fortunes of those enterprises?
3. How might a decision to let the yuan float freely affect future foreign direct investment flows into China?
4. Under what circumstances might a decision to let the yuan float freely destabilize the Chinese economy? What might the global implications of this be?
5. Do you think the U.S. government should push the Chinese to let the yuan float freely? Why?
6. What do you think the Chinese government should do? Let the yuan float, maintain the peg, or change the peg in some way
Attachment:- china case study.rar