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indigowoodchuck616Lv1

18 Aug 2020

Which of the following best explains what happens to the exchange rate of a floating currency?

A. The exchange rate for that currency is determined by changes in the value of the U.S. dollar.

B. The exchange rate for that currency increases or decreases depending on the size of the country's GDP.

C. The exchange rate for that currency goes up and down with the price of gold.

D. The exchange rate for that currency changes depending on the operations of the free market

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Samantha BalandoLv7

10 Oct 2020

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Related questions

13. People or firms use one currency to purchase another currency at the ___. A. international currency exchange B. foreign exchange market C. foreign currency exchange D. international parity market

17. If government policy allows a country's currency to be determined in the exchange rate market, then that currency will be subject to A. a hard peg policy. B. purchasing power parity. C. depreciation. D. a floating exchange rate.

19. Which of the following is an example of a pegged currency?

A. U.S. dollar B. British pound C. Euro D. Chinese yuan

22. Using the term "spillover" is a less formal means of describing

A. an externality. B. social costs. C. private costs. D. market failure.

32. Steve and Craig have been shipwrecked on a deserted island in the South Pacific. Their economic activity consists of either gathering pineapples or fishing. We know Steve can catch four fish in one hour or harvest two baskets of pineapples. In the same time Craig can reel in two fish or harvest two baskets of pineapples.

Assume Craig and Steve both operate on straight-line production possibilities curves. What is Steve's opportunity cost of producing a basket of pineapples? Of a producing a fish? What is Craig's opportunity cost of producing a basket of pineapples? Of a producing a fish?

Which of the following statements is accurate in regards to the US dollar:

A.	The central bank is responsible for printing the domestic currency and the value of the currency is adjusted to maintain a fixed level to another currency.
B.	The central bank has no ability to print the domestic currency and dollarization was adopted to minimize domestic inflation.
C.	Banks are responsible for printing the domestic currency and there is a floating exchange rate.
D.	The central bank (e.g. Federal Reserve) is responsible for printing the domestic currency and there is a floating exchange rate.

Suppose that monetary policy in the United States leads to an increase in interest rates relative to those in Japan. Which of the following will occur in the capital account:

A.	The demand for yen will increase.
B.	The dollar will appreciate relative to the yen.
C.	The supply of dollars will increase.
D.	The dollar will depreciate relative to the yen.

An expansionary monetary policy by the Fed would tend to:

A.	Lower the U.S. inflation rate, make exports cheaper, make imports more expensive, and raise the value of the dollar.
B.	Raise the U.S. inflation rate, make exports more expensive, make imports cheaper, and lower the value of the dollar.
C.	Raise the U.S. inflation rate, make exports cheaper, make imports more expensive, and raise the value of the dollar.
D.	Lower the U.S. inflation rate, make exports more expensive, make imports cheaper, and lower the value of the dollar.

cerisecod404

1. GDP =

a. GNP + net unilateral transfers.

b. GNP - net unilateral transfers.

c. GNP + balance on secondary income.

d. GNP - net receipts of production factor income coming from the rest of the world.

e. GNP + net receipts of production factor income coming from the rest of the world.

2. The spot exchange rate is the exchange that applies when:

a. you make a transaction today by purchasing one currency with another, executing the exchange of currencies immediately.

b. the volume on the currency market is low, i.e. "spotty", so exchange movements may be rapid with each trade.

c. you agree to make purchase one currency with another but the trading of the currencies happens, say, 3, 6, 9, or 12 months from now.

d. the exchange of currency is not electronic, but instead, you can see, i.e. "spot", the currency.

e. you agree to loan, i.e. "spot", the currency to another.

3. If Sweden's central bank sells US dollars to Swedish commercial banks in return for Swedish crowns, then according to IMF definitions, this transaction should show up in Sweden's

a. current account as a credit and in Sweden's financial account as a debit.

b. nonreserve financial account as a debit and in Sweden's official settlements balance as a credit.

c. capital account as a credit and in Sweden's financial account as a debit.

d. nonreserve financial account as a credit and in Sweden's official settlements balance as a debit.

e. capital account as a debit and in Sweden's financial account as a credit