7 million), due to slower growth in manufacturing and construction. As the economy slowed, the demand for electronic consumer goods, manufacturing, and construction machinery decreased. Major competition for U.S. products comes from companies in Western Europe and Central America. The market is excellent for agricultural and used machinery. There is no local production of most kinds of machinery.
Tourism: According to the Institute of Tourism, tourism was Nicaragua's second most important source of foreign exchange in 2000, representing a $112.5 million market (an increase of 7 percent over 1999). In 2001, tourist arrivals were expected to grow to 513,600 and are projected to reach 685,000 in 2005. Roughly 20 percent of the tourists are from the United States. Nicaragua's new tax law provides several tax breaks for investments. Best prospects for investment include accommodations outside of Managua. Nicaragua's tax law provides tax breaks for investments in: .
• Hotel service industry.
• Investments in Protected Areas of Tourism and Ecological Interest.
• Air Transportation.
• Water Transportation.
• Food, Beverage and Entertainment Services.
• Investment in filming of motion pictures.
Supply and demand analysis reveals how equilibrium prices and quantities of exports and imports are determined. The amount of goods or service a nation will export or import depends on differences between the equilibrium world price and the equilibrium domestic price. .
The exchange is the rate at which the currency of one nation can be exchanged for the currency of another nation. The currency of Nicaragua is the gold cordoba, and the exchange rate has ranged between 13.28 and 15.10 cordobas per U.S. dollar over the past year (http://www.oanda.com/convert/classic).
EMPLOYMENT IN NICARAGUA .
In Nicaragua, more than 50 percent of the population lives below the poverty line (US$104) (dol.