1. Undervalued Currency: China A look at the dynamics of the Chinese Renminbi. By: Adam Starr and Ryan Cortez

2. Overview Is the Renminbi undervalued? What does this do for China? What does this mean for the World? Why should China appreciate the Renminbi?

4. How do we know the Renminbi is undervalued? The Big Mac Index: China BM = $1.83 U.S. BM = $3.58 Purchasing of Foreign Assets Capital Acct + Current Acct = 0

5. What does this do for China? Maintains high demand for domestic production Keeps jobs in exporting sectors Labor income is lower than it could be

6. What does this mean for the world? Cheaper imports Less competition internationally Less consumption for non-Chinese goods

8. Why appreciate the Renminbi? Increase the value of wages in China To prevent trade sanctions from the US and EU Allow more competition for other developing countries exports