ECO summary:exchange rate

EXCHANGE RATE:the value of a currency in terms of what it can buy of other currencies.

WHAT FACTORS MIGHT AFFECT EXCHANGE RATE?
-the price of /demand for imported goods and services
-the price of /demand for exported goods and services
-aggregate demand
-the growth of real income output in the short term
-the rate of inflation
-employment/unemployment

WHAT IF STERLING VALUE GOES DOWN?
-import price goes up
-consumer price index
-export does goes up
-strong AD -inflation

STRONG POUND?
-low import price,more import
-high export price,less export
-less inflation
-strong PPP