Question
( Place answers in the PowerPoint Key Provided then UPLOAD ) Read the World Bank article (below) on economic shocks in Thailand since COVID. Use
( Place answers in the PowerPoint Key Provided then UPLOAD ) Read the World Bank article (below) on economic shocks in Thailand since COVID. Use the axes in the answer key to depict in detail a simulation of the goods, money, bond, and foreign exchange markets of the Thai economy associated with the economic shock outlined in the World Bank report. Be sure to label each graph, reflecting each market, starting with the market in which the shock occurs on the left. Properly label the axes to reflect the variables associated with each market. Identify the composite shock to the present equilibrium that is associated with the various factors cited by the World Bank associated with economic distress during COVID. Be sure to begin your simulation with the market in which the shock would occur. Use the model developed in class to determine the expected change in the all basic economic variables of the Thai economy, resulting from these developments in Thailand. For questions relating to the foreign exchange market, show your answer in terms of Thai Baht (THB) and the US Dollar/ Thai Baht (THB) exchange rate. Axes must be clearly labeled and initial and final positions of all variables clearly depicted. Initial positions should be representative of the markets in the originally described state of the Thai economy. Provide a systematic "1-2-3 bullet point" explanation for the logical dynamics of your answer and indicate all relevant assumptions you derive from information in the article. Assume Thai Capital Markets are highly mobile. The Impact of COVID on Thailand's Economy Private consumption contracted by 1.3 percent due to the imposition of mobility restrictions and social distancing measures, and the resulting reductions in jobs and incomes. Private investment declined by 4.4 percent amid continued uncertainty around the medium-term outlook for exports and growth. The external sector remained depressed. Services exports suffered a severe contraction as international border restrictions remained in place and international tourism remained negligible. Goods exports declined due to deteriorating external goods demand.
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