11TheassumptionsofthetraditionalapproachestoexchangerateandbalanceofpaymentsdeterminationreflectthefactthattheyweredevelopedduringthetimeofthegoldstandardandtheearlyBretton8Theelasticitiesapproachemphasizestheeffectsofchangesinindeterminingtheofbalanceofpaymentsandtheexchangeratethepricesofgoods9Accordingtotheelasticitiesapproachtheelasticitiesoftheimportdemandandexportsupplycurvesdeterminehowmuchthequantityofimportsdemandedandthequantityofexportssuppliedwillchangeinresponsetoachangeintheexchang