Course: Principles of Macroeconomics (ECON 2) · Silver Oak University (fictional sample) · Prof. Ashford
Focus: Open-Economy Macro: Exchange Rates & the Balance of Payments · Objective 8 · SLO A & B

📋 Module Overview Page — "Start Here" (Canvas: Page, published)

Week 14 — Open-Economy Macro: Exchange Rates & the Balance of Payments

Last week you learned why countries trade at all — comparative advantage. This week you learn the price that makes international trade actually happen: the exchange rate. You'll learn to read appreciation and depreciation correctly (the single most-flipped idea in this unit), trace exactly how a currency move changes the price of a car or a machine in another country, and connect all of it to net exports and the balance of payments — the accounting mirror between a country's current account and its financial account.

The big question: When a currency's exchange rate moves, who gets cheaper prices, who gets pricier prices, and what happens to net exports?

By the end of this week, you can:

• correctly identify appreciation vs. depreciation from a change in an exchange rate (e.g., $1 = ¥100 → $1 = ¥120) without flipping the direction — the classic error this week guards against;
• trace how a currency move changes the price a foreign buyer pays for a U.S. export and the price a U.S. buyer pays for a foreign import, and combine the two into a net-exports (NX) conclusion;
• describe the foreign-exchange (FX) market qualitatively — what makes a currency's price rise or fall;
• state the balance-of-payments mirror: a current-account balance and a financial-account balance offset each other (principles level).

Do this, in order:

1. Read & watch — the Week 14 resources (≈35 min). → Readings & Resources page
2. Lecture Tutorial — work through exchange rates, the FX market, NX effects & the BoP mirror with your AI tutor (≈45 min). Due Sun, Dec 6. → submit the chat share link + summary
3. Practice Exercises — 6 quick reps, ungraded (≈15 min).
4. Quiz 14 — 10 questions, closed to AI (≈20 min). Due Sun, Dec 6.
5. Discussion 14 — "Is a strong dollar good for America?" Initial post Fri, Dec 4, replies Sun, Dec 6.
6. Assignment 14 — the exchange-rate, NX & BoP problem set (100 pts). Due Sun, Dec 6.
7. Workshop 14 — Graph & Model Workshop — "Exchange Rates & Net Exports": convert two goods both directions at both rates and state the NX conclusion (50 pts). Due Sun, Dec 6.

A note before you start: the word "appreciation" sounds like it should mean "good" and "depreciation" sounds like it should mean "bad" — resist that instinct. Both are just directions a price moved, and (as this week's discussion will show you) a stronger dollar creates winners and losers at the very same time. Every number this week is engineered to land clean and is Python-verified; every direction claim follows the graph-logic canon exactly. You've got this. 💪

📣 Welcome Announcement (Canvas: Announcement; available_from_offset_days = 0 — posts Mon, Nov 30)

Subject: Which way did the dollar move? 💱

Hi everyone, and welcome to Week 14!

Here's the whole week in one sentence: an exchange rate is just a price — the price of one currency stated in another — and once you can read which way it moved, you can predict exactly who wins and who loses on both sides of the ocean. We'll take the same $25,000 American car and the same ¥1,200,000 Japanese machine and watch their prices shift as the dollar moves, then connect that straight to net exports and the balance of payments.

This week, don't miss:

• The appreciation vs. depreciation direction check — this is the single most commonly flipped idea in the whole unit, and it's exactly what Quiz 14 is built to test.
• The export/import price chain — one currency move, two price changes, one NX conclusion. You'll do this by hand for two goods, both directions, in the Workshop.
• The balance-of-payments mirror — the current account and the financial account are two sides of the same coin, not two independent numbers.

Start with the Module Overview ("Start Here"), then the readings, then your AI Lecture Tutorial. Bring a currency-direction question to class — this is the week worth double-checking your intuition against the math.

See you in class,
Prof. Ashford