Assignment:
Reading the case China's Exchange Rate Regime
Case Discussion Questions
1. Why do you think that the Chinese historically pegged the value of the yuan to the U.S. dollar?
2. Why did the Chinese move to a managed-float system in 2005?
3. What are the benefits that China might gain by allowing the yuan to float freely against other major currencies such as the U.S. dollar and the euro? What are the risks? What do you think they should do?
4. Is there any evidence that the Chinese kept the level of its currency artificially low in the past to boost exports? Is China keeping it artificially low today?
5. What policy stance should the United States and the EU adopt toward China with regard to how it manages the value of its currency?
I have to read this article and write a 2000 word eassy from answering the questions at the end not including the reference page or the title page. I also need an abstract of 150 words.