To what extent is the policy of gradual appreciation of the Singapore Dollar (SGD) always a desirable approach to maintain economic stability in Singapore? [25]
Analysis of The Question
For this question, the requirement of the question is to be able to understand that low inflation and unemployment are two main aims the Singapore government uses to attain sustainable economic growth, while explaining the policy of exchange rate management policy in its usefulness in achieving these aims.
Critically analyse the disadvantages of exchange rate system in achieving economics stability.
Source of Information
Part of knowledge needed for this question:
Explain what are price stability and low unemployment
Explain the exchange rate system in achieving low inflation
Explain, with aid of a diagram, the concept of sustainable growth
Explain the benefits of exchange rate policy in the context of Singapore
Explain the potential limitations of exchange rate policy in the context of Singapore