1. Why do companies, institutions and people buy and sell currencies?

Copanies, institutions and people  buy and sell currencies to make money on the difference between
the two currencies.

- the value of money is affected by the economic actions of its government or central bank,
economy, income, inflation...
- to make money on the difference between the two currencies
- exchanging national currencies against one another
- some countries they want to manage people and the world

People
- to get higher interests when the prices of foreign currencies rise and fall
- to buy products form abroad
- change your home currency for the currency of where you are going/travelling
- if you're working abroad, you want to send money back home to relatives, you  will trade
currencies. 

2. How is the value (the exchange rate) of the money in your pocket determined?

The value (the exchange rate) of the money in your pocket is determined by the demand of society,
the economic actions of government central bank

Reading

Gold convertibility Khả năng chuyển đổi vàng

Market forces Lực lượng thị trường
Parity and speculation Mệnh giá tương đương, đầu cơ (tích trữ)
Counteracting speculation
Market intervention Can thiệp thị trường

Questions

1. What was gold convertibility?

2. Why did gold convertibility end in 1971?
- Because of gold inflation
3. How is a floating exchange rate determined?
- By the numbers of buyers and sellers
4. What would happen if there was purchasing power parity?
The cost of given selection of goods and services would be the same
5. Why do speculators buy foreign currencies?
- to get a higher interest rate of make a capital gain
6. What proportion/ percentage of currency transaction are speculative?
 - about 95%
7. How can companies try to protect themselves against currency fluctuations?
- by buying future contracts
8. How can governments attempt to influence the value of their currency?
- by buying or selling their currency on the exchange markets
9. Why are governments' or central banks' attempts to influence exchange rates not very
successful?
- Because speculators have much more

Vocabulary

1. Revalue To increase the value of a currency in an otherwise tăng giá trị hối
fixed system đoái
2. devalue Giảm ..
3. floating
4. proponents Đề xuất
5. depreciate Sụt giảm
6. appreciate
7. hedge Đảm bảo, phòng
ngừa rủi ro
8. fluctuations Biến động
9. future contracts

DISCUSSION

CASE STUDY

Read the case study and. imagine that you have been invited to advise the government on how the
proceeds of a currency transaction tax should be spent, and where. Select five of the following
suggestions, and number them in order of priority:

5 - Cleaning up pollution

- Developing alternative energy installations

3 - Disaster aid (future earthquakes, hurricanes. floods. etc,)

4 - Disease prevention (AIDS and other diseases}

2 - Education and literacy (for children and adults)

1 - Health clinics and hospitals

- Humanitarian aid for refugees from wars, famine, or political persecution

- Land preservation and environmental restoration (planting trees, etc)

- Monitoring and protecting endangered species - Removing landmines

 1. Health clinics and hópital
2. education and literacy
3. disaster aid
Health systems have played a part in the
dramatic rise in life expectancy that occurred
during the 20th century. They have contributed
enormously to better health and influenced the
lives and well-being of billions of people around
the world
Education shows us the importance of hard work
and, at the same time, helps us grow and
develop. Thus, we are able to shape a better
society to live in by knowing and respecting
rights, laws, and regulations
Delivering disaster aid to victims quickly not only
restores lost assets, but also maintains their
aspirations — and invests in communities’ longer-
term economic and democratic health.

+ cause severe damage to a country ->

4. Disease prevention prevention involves actions to reduce or
eliminate exposure to risks that might increase
the chances that an individual or group will incur
disease, disability, or premature death.

+ if the country citizens are healthy

5. Cleaning up solutions A Clean Environment Is Essential for Healthy
Living: The more you don't care about our
environment, the more it will become polluted
with contaminants and toxins that have a harmful
impact on our health. Air pollution can cause
respiratory diseases and cancer, among other
problems and diseases.

+ nowadays, getting more and more polluted ->

should tackle the probem sasp

++ specific

% tax

Process

examples