ManagingTheU.S DollarInThe 1980s

1. What does it mean for a currency to be "overvalued"?In late 1984, what evidence was there that the dollar might have been overvalued?
2. How would you explain the dollar's strength prior to 1985?What economic fundamentals appear to have been at work?What risks and opportunities did this strength present to U.S. business interests?
3. Was the dollar appropriately priced in late 1986?Again, what evidence would you cite in support of your opinion.
4. Is a weak dollar good for the U.S. economy?Why or why not?Why has the US. Trade deficit been slow to respond to the weakened dollar?
5. Why and how do exchange rates influence corporate investment decisions? Corporate financing decisions