Question 1

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

Accepted Answer

A) appreciation of the U.S. dollar and depreciation of the foreign currency. 
B) appreciation of the U.S. dollar and appreciation of the foreign currency. 
C) depreciation of the U.S. dollar and depreciation of the foreign currency. 
D) depreciation of the U.S. dollar and appreciation of the foreign currency. 
A) appreciation of the U.S. dollar and depreciation of the foreign currency. 
B) appreciation of the U.S. dollar and appreciation of the foreign currency. 
C) depreciation of the U.S. dollar and depreciation of the foreign currency. 
D) depreciation of the U.S. dollar and appreciation of the foreign currency.

Question 2

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

Accepted Answer

A) higher U.S. interest rates resulting in lower capital outflows. 
B) lower U.S. interest rates resulting in higher capital outflows. 
C) higher U.S. interest rates resulting in higher capital outflows. 
D) lower U.S. interest rates resulting in lower capital outflows. 
A) higher U.S. interest rates resulting in lower capital outflows. 
B) lower U.S. interest rates resulting in higher capital outflows. 
C) higher U.S. interest rates resulting in higher capital outflows. 
D) lower U.S. interest rates resulting in lower capital outflows.

Question 3

Changes in domestic and foreign income result in:

Accepted Answer

A) movements along the demand and supply curves of the foreign exchange market. 
B) shifts in the demand and supply curves of the foreign exchange market. 
C) all of the above. 
D) none of the above. 
A) movements along the demand and supply curves of the foreign exchange market. 
B) shifts in the demand and supply curves of the foreign exchange market. 
C) all of the above. 
D) none of the above.

Question 4

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

Accepted Answer

A) decrease the country's money supply if there is a non-sterilized central bank intervention. 
B) decrease the country's money supply if there is a sterilized central bank intervention. 
C) increase the country's money supply if there is a non-sterilized central bank intervention. 
D) increase the country's money supply if there is a sterilized central bank intervention. 
A) decrease the country's money supply if there is a non-sterilized central bank intervention. 
B) decrease the country's money supply if there is a sterilized central bank intervention. 
C) increase the country's money supply if there is a non-sterilized central bank intervention. 
D) increase the country's money supply if there is a sterilized central bank intervention.

Question 5

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

Accepted Answer

A) financial account deficit. 
B) financial account surplus. 
C) budget deficit. 
D) budget surplus. 
A) financial account deficit. 
B) financial account surplus. 
C) budget deficit. 
D) budget surplus.

Question 6

A record of all transactions between residents of the reporting country and residents of the rest of the world over a period of time is called the:

Accepted Answer

A) national income product accounts. 
B) balance of payments accounting system. 
C) accrual accounting system. 
D) none of the above. 
A) national income product accounts. 
B) balance of payments accounting system. 
C) accrual accounting system. 
D) none of the above.

Question 7

Net exports are:

Accepted Answer

A) negatively related to domestic income, positively related to income in the rest of the world, and positively related to currency appreciation. 
B) negatively related to domestic income, positively related to income in the rest of the world, and positively related to currency depreciation. 
C) positively related to domestic income, positively related to income in the rest of the world, and positively related to currency appreciation. 
D) positively related to domestic income, positively related to income in the rest of the world, and positively related to currency depreciation. 
A) negatively related to domestic income, positively related to income in the rest of the world, and positively related to currency appreciation. 
B) negatively related to domestic income, positively related to income in the rest of the world, and positively related to currency depreciation. 
C) positively related to domestic income, positively related to income in the rest of the world, and positively related to currency appreciation. 
D) positively related to domestic income, positively related to income in the rest of the world, and positively related to currency depreciation.

Question 8

When a country's import spending exceeds export spending,the country is experiencing a:

Accepted Answer

A) trade deficit. 
B) trade surplus. 
C) budget deficit. 
D) none of the above. 
A) trade deficit. 
B) trade surplus. 
C) budget deficit. 
D) none of the above.

Question 9

Gold certificates,special drawing rights,the reserve position of the IMF,and the holdings of foreign currencies represent:

Accepted Answer

A) physical assets. 
B) reserve assets. 
C) monetary assets. 
D) none of the above. 
A) physical assets. 
B) reserve assets. 
C) monetary assets. 
D) none of the above.

Question 10

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

Accepted Answer

A) True 
 B)False

Question 11

You are given the following information.
   
Compute the level of private savings,public savings,national savings,and net exports.

Accepted Answer

The answer of You are given the following information.
 ...

Question 12

If there is a current account surplus,then there is a financial account deficit.

Accepted Answer

A) True 
 B)False

Question 13

Using the foreign exchange market diagram,graphically illustrate and explain the impact of U.S.interest rates that exceed foreign interest rates,all else constant,on the exchange rate.

Accepted Answer

The higher U.S.interest rates would resu

Question 14

A decrease in the demand for dollars on the foreign exchange market,all else equal,will result in:

Accepted Answer

A) appreciation of the U.S. dollar and depreciation of the foreign currency. 
B) appreciation of the U.S. dollar and appreciation of the foreign currency. 
C) depreciation of the U.S. dollar and depreciation of the foreign currency. 
D) depreciation of the U.S. dollar and appreciation of the foreign currency. 
A) appreciation of the U.S. dollar and depreciation of the foreign currency. 
B) appreciation of the U.S. dollar and appreciation of the foreign currency. 
C) depreciation of the U.S. dollar and depreciation of the foreign currency. 
D) depreciation of the U.S. dollar and appreciation of the foreign currency.

Question 15

In the case of Thailand in 1997,the Thai government was running a large:

Accepted Answer

A) current account surplus, requiring capital inflows from abroad. 
B) current account deficit, requiring capital inflows from abroad. 
C) current account surplus, requiring capital outflows. 
D) current account deficit, requiring capital outflows. 
A) current account surplus, requiring capital inflows from abroad. 
B) current account deficit, requiring capital inflows from abroad. 
C) current account surplus, requiring capital outflows. 
D) current account deficit, requiring capital outflows.

Question 16

The difference between the interest income or receipts earned on investments in the rest of the world by the residents of a given country and the payments to foreigners on investments they have made in the given country is called:

Accepted Answer

A) unilateral transfers. 
B) bilateral transfers. 
C) net investment income. 
D) gross investment income. 
A) unilateral transfers. 
B) bilateral transfers. 
C) net investment income. 
D) gross investment income.

Question 17

Imports are:

Accepted Answer

A) positively related to income in the rest of the world and currency appreciation. 
B) positively related to income in the rest of the world and currency depreciation. 
C) positively related to domestic income and currency appreciation. 
D) positively related to domestic income and currency depreciation. 
A) positively related to income in the rest of the world and currency appreciation. 
B) positively related to income in the rest of the world and currency depreciation. 
C) positively related to domestic income and currency appreciation. 
D) positively related to domestic income and currency depreciation.

Question 18

A lending of a country's savings that occurs when the country has a trade deficit and its citizens purchase real and financial assets from abroad is called a capital inflow.

Accepted Answer

A) True 
 B)False

Question 19

In 2003,China's control of the value of the yuan became an economic and political issue for the U.S.because:

Accepted Answer

A) increased U.S. exports to China. 
B) decreased U.S. exports to China. 
C) increased China imports from the U.S. 
D) none of the above. 
A) increased U.S. exports to China. 
B) decreased U.S. exports to China. 
C) increased China imports from the U.S. 
D) none of the above.

Question 20

Multinational companies are concerned about exchange rate risk.

Accepted Answer

A) True 
 B)False

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

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

Changes in domestic and foreign income result in:

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

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

A record of all transactions between residents of the reporting country and residents of the rest of the world over a period of time is called the:

Net exports are:

When a country's import spending exceeds export spending,the country is experiencing a:

Gold certificates,special drawing rights,the reserve position of the IMF,and the holdings of foreign currencies represent:

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

You are given the following information. Compute the level of private savings,public savings,national savings,and net exports.

If there is a current account surplus,then there is a financial account deficit.

Using the foreign exchange market diagram,graphically illustrate and explain the impact of U.S.interest rates that exceed foreign interest rates,all else constant,on the exchange rate.

A decrease in the demand for dollars on the foreign exchange market,all else equal,will result in:

In the case of Thailand in 1997,the Thai government was running a large:

The difference between the interest income or receipts earned on investments in the rest of the world by the residents of a given country and the payments to foreigners on investments they have made in the given country is called:

Imports are:

A lending of a country's savings that occurs when the country has a trade deficit and its citizens purchase real and financial assets from abroad is called a capital inflow.

In 2003,China's control of the value of the yuan became an economic and political issue for the U.S.because:

Multinational companies are concerned about exchange rate risk.

Managers and Economics

Demand, supply, and Equilibrium Prices

Demand Elasticities

Techniques for Understanding Consumer Demand and Behavior

Production and Cost Analysis in the Short Run

Production and Cost Analysis in the Long Run

Market Structure: Perfect Competition

Market Structure: Monopoly and Monopolistic Competition

Market Structure: Oligopoly

Pricing Strategies for the Firm

Measuring Macroeconomic Activity

Spending by Individuals, firms, and Governments on Real Goods and Services

The Role of Money in the Macro Economy

The Aggregate Model of the Macro Economy

Combining Micro and Macro Analysis for Managerial Decision Making

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

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

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

Changes in domestic and foreign income result in:

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

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

A record of all transactions between residents of the reporting country and residents of the rest of the world over a period of time is called the:

Net exports are:

When a country's import spending exceeds export spending,the country is experiencing a:

Gold certificates,special drawing rights,the reserve position of the IMF,and the holdings of foreign currencies represent:

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

You are given the following information. Compute the level of private savings,public savings,national savings,and net exports.

If there is a current account surplus,then there is a financial account deficit.

Using the foreign exchange market diagram,graphically illustrate and explain the impact of U.S.interest rates that exceed foreign interest rates,all else constant,on the exchange rate.

A decrease in the demand for dollars on the foreign exchange market,all else equal,will result in:

In the case of Thailand in 1997,the Thai government was running a large:

The difference between the interest income or receipts earned on investments in the rest of the world by the residents of a given country and the payments to foreigners on investments they have made in the given country is called:

Imports are:

A lending of a country's savings that occurs when the country has a trade deficit and its citizens purchase real and financial assets from abroad is called a capital inflow.

In 2003,China's control of the value of the yuan became an economic and political issue for the U.S.because:

Multinational companies are concerned about exchange rate risk.

Managers and Economics

Demand, supply, and Equilibrium Prices

Demand Elasticities

Techniques for Understanding Consumer Demand and Behavior

Production and Cost Analysis in the Short Run

Production and Cost Analysis in the Long Run

Market Structure: Perfect Competition

Market Structure: Monopoly and Monopolistic Competition

Market Structure: Oligopoly

Pricing Strategies for the Firm

Measuring Macroeconomic Activity

Spending by Individuals, firms, and Governments on Real Goods and Services

The Role of Money in the Macro Economy

The Aggregate Model of the Macro Economy

Combining Micro and Macro Analysis for Managerial Decision Making

Filters