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- Last month the US dollar appreciated by 1% against the Japanese Yen. The US dollar also appreciated by 3.1% against the Euro. By approximately how much did the Euro shift against the Yen over this period? O a. Euro appreciated by 4.1% O b. Euro depreciated by 4.1% O c. Euro appreciated by 2.1% 4 O d. Euro neither appreciated nor depreciated against the Yen O e. Euro depreciated by 2.1%Suppose that the exchange rate between the United States dollar ($) and the Thai currency, baht (8), is 81=$0.05. Leticia wants to buy a B600 souvenir trom Thalland. What is the souvenir's price in dollars? O $0.05 O $1 O $30 O $600 O $12,000Under a fixed exchange rate system (A). would be an exogenous monetary policy instrument, whereas under a flexible exchange rate system (B) endogenous monetary policy instrument. would be an O a. (A) the interest rate; (B) the exchange rate O b. (A) the exchange rate; (B) the interest rate O c. (A) the interest rate; (B) the interest rate O d. (A) the exchange rate; (B) the exchange rate
- Using the equation S=1+ NCO we can say O a. Savers can do two things with their funds, invest them domestically through NCO or in foreign markets via l Savers can do two things with their funds, invest them domestically through I or in foreign markets through Ob. NCO O. Savers have unlimited options for their money O d. Investment and NCO must be equalQUESTION 18 Suppose Korea decided to fix its exchange rate with Japan. Japan does not change its policies. What inflation rate will you see for Korea? O One percent O-2 precent. Deflation Zero inflation O 4 percent inflation We do not have enough information to answer this question QUESTION 19 Under the fixed exchange rate mentioned in 18, how fast will the Korean money supply grow? O 1 percent O 2 precent O 7 percent O 4 percent We do not have enough information to answer this question QUESTION 20 Compared to most European countries, workers in the US work O More • Lss O About the same O Sometimes more, sometimes less We do not have enough information to answer this question. Click Save and Submit to save and submit. Click Save All Answers to save all answers. SavA Moving to another question will save this response. Question 3 What is the likely result from a depreciation of a nation's currency when its economy is already operating at its full-employment level of output? O A. Net exports would rise and contribute to demand-pull inflation. O B. Net exports would fall and contribute to demand-pull inflation. O C. Net exports would rise, but equilibrium GDP would fall. O D. Net exports would fall, but equilibrium GDP would rise. A Moving to another question will save this response. SHA
- If the Bank of Canada raises its target for the overnight interest rate from 3 percent to 3.25 percent while interest rates in other countries do not change, the result is of financial capital, in demand for Canadian dollars and of the Canadian dollar. O a. An outflow; a decrease; aldepreciation. O b. An inflow; a decrease; a depreciation. O c. An outflow; an increase; an appreciation. O d. An inflow; an increase; a depreciation. O e. An inflow; an increase; an appreciation.A Moving to another question will save this response. Quèstion 16 What is the likely result from a depreciation of a nation's currency when its economy is already operating at its full-employment level of output? O A. Net exports would rise, but equilibrium GDP would fall. O B. Net exports would fall and contribute to demand-pull inflation. OC. Net exports would fall, but equilibrium GDP would rise. O D. Net exports would rise and contribute to demand-pull inflation. hp *****In the foreign exchange market, if the U.S. interest rate rises relative to interest rates in other nations, then the demand curve for U.S. dollars and the supply curve of U.S. dollars does not shift; does not shifts O b. shifts to the left; shifts to the right shifts to the right; shifts to the right O d. shifts to the left; shifts to the left O . shifts to the right; shifts to the left
- b) Exchange rate lyen per dollar) 250 200 150 100 50 0 $ Target exchange role Do D₁ D₂ 0.8 0.9 1.0 1.1 1.2 1.3 Quantity rillions of U.S. dollars per day) 9. In the above figure, suppose the demand for dollars temporarily increases so that the demand curve shifts to D1. To maintain the target exchange rate, the Fed can sell dollars. O must violate interest rate parity but not purchasing power parity. can buy dollars. O cannot maintain the target exchange rate.Assume that the U.S. interest rate is 12 percent, while the British interest rate is 15 percent. If interest rate parity exists, then: O a.U.S. investors will earn 12 percent whether they use covered interest arbitrage or invest in the United States. O b. U.S. investors will earn a higher rate of return when using covered interest arbitrage than what they would earn in the United States. O c. British investors who invest in the United Kingdom will achieve the same return as U.S. investors who invest in the United States. O d. U.S. investors will earn 15 percent whether they use covered interest arbitrage or invest in the United States.Suppose the foreign exchange market is in equilibrium. Which of the following expressions are correct? Check all that apply. O Imports + Exports = Capital Out flow + Capital In flow □ Imports - Capital Out flow = Exports - Capital In flow O Imports + Capital Out flow = Exports + Capital In flow O Trade Deficit (Imports minus Exports) = Net Capital In flow
