In terms of the approaches to exchange rate forecasting,_____ draw(s)on economic theory to construct sophisticated econometric models for predicting exchange rate movements.

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Fundamental analysis draws on economic theory and uses econometric models to predict exchange rate movements based on economic fundamentals such as interest rates, inflation, and trade balances. Technical analysis and chart analysis use historical price and volume data to identify patterns and trends for future prices, while fractional integration models and Markov switching models are statistical methods for analyzing time-series data.

In Terms of the Approaches to Exchange Rate Forecasting,_____ Draw(s)on