Exam 15: International and Balance of Payments Issues in the Macro Economy

A decreased demand for U.S. dollars on the foreign exchange market, all else equal, will result in a depreciation of the U.S. dollar.

A sterilized central bank intervention does not affect the domestic money supply.

A fixed exchange rate system where central banks buy and sell gold to keep exchange rates at a given level is called the:

The U.S. exports computers with a domestic price of $100,000 and the yen/dollar exchange rate is 120 on January 1, 2003. On January 1, 2004 the yen/dollar exchange rate is 125. What is the yen price of the computers on January 1, 2003? What is the yen price of the computers on January 1, 2004?

A trade surplus means:

In an open mixed economy, injections are saving, taxation, and import spending.

The major factor contributing to the depreciation of the dollar in 2007-2008 was:

Under a fixed exchange rate system, a balance of payments deficit may:

When the exchange rate is allowed to shift gradually over time, or within an exchange rate band which may also shift over time, this is considered an):

As a currency depreciates:

Multinational companies are concerned about exchange rate risk.

An international organization created at the Bretton Woods conference in 1944 that helps coordinate international financial flows and can arrange short-term loans between countries is called the:

Capital outflows occur if:

Assets which include foreign currencies and gold certificates that central banks use to maintain exchange rates in a predetermined range are called:

An increase in the supply of dollars on the foreign exchange market, all else equal, will result in:

If net capital flow were zero for a country, then exports would not equal imports.

Under a fixed exchange rate system, a balance of payments surplus may:

Within the balance of payments, a current account deficit is offset by a:

Imports are:

Under a fixed exchange rate system, the central bank of a country experiencing a balance of payments surplus will: