Published a report in 1994 in which it ranked countries by gross national product per capita using

This method, and the OECD (Organization for Economic Cooperation and Development) also

Publishes comparable international economic data based on PPP.

Vocabulary Notes to Text 9.7.1.2

A basket of goods and services — корзина товаров и услуг

The purchasing-power parity — паритет покупательной способности

Market exchange rates — рыночные валютные курсы

A preferred alternative — предпочтительная альтернатива

9.7.1.З. Read the text “The Exchange Rate as a Component of the Price Mechanism between the

Domestic and International Consumption Sectors.” Give a synopsis of it either in English or in Russian.

The Exchange Rate as a Component o f the Price Mechanism between the Domestic

And International Consumption Sectors

Transactions in foreign exchange occur spot or forward (spot market and forward market) in the

Foreign-exchange markets. The actual rate at any one time is determined by supply and demand

Conditions for the relevant currencies in the market. However, probably the best way of viewing the

exchange rate is as the economy’s device for altering the relative prices of domestic produce, which

Does not trade internationally; and international produce, subject to import and export.

Take an example. Oil is priced internationally, with prices set in dollars. Competitive forces