Marking criteria
(i) analysis: in-depth analysis correctly identifying the peso problem and its consequences (if any) for market efficiency. This also includes an analysis of the empirical literature.
(ii) critical awareness: ability to connect the peso problem to different models/explanations and pinpoint their relative advantages/disadvantages.
(iii) references adequately incorporated into the analysis.
!!!!!!Recommended Readings and Hints!!!!:
The discursive question is based on Part III of the program- so you need to look at the required readings for that part.
The work in tutorial 3 and associated feedback will provide a good starting point for your answer.
The challenge of this discursive question will be to be able to summarise all your knowledge on the peso problem (and references) into 500 words only.
Go straight to the point in question
Use equations to achieve a higher degree of precision without using too many words
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