Exam 12: Open-Economy Macroeconomics: Basic Concepts

In Canada,a cup of hot chocolate costs $6.In Australia,the same hot chocolate costs 6 Australian dollars.If the exchange rate is $2 Australian dollars per Canadian dollar,what is the real exchange rate?

When a country's central bank increases the money supply,which statement best predicts the consequences?

What does purchasing-power parity imply for the exchange rate?

If the exchange rate is 175 yen = $1,what is the cost of a bottle of rice wine that costs 7875 yen?

Which of the following would be Canadian foreign direct investment?

What would an appreciation of the Canadian real exchange rate induce Canadian consumers to buy?

What is the most likely effect of an appreciation of the Canadian real exchange rate on the quantity of Alberta beef demanded by French citizens?

Suppose that in 1999 you could purchase about 400 Greek drachmas (the former Greek currency,replaced by the euro in 2002)for a dollar.In 2000,you could purchase about 350 drachmas for a dollar.Which statement best explains the changes that could have taken place between 1999 and 2000?

Suppose a bottle of wine costs 25 euros in France and $20 in Canada.If the exchange rate is 1.25 euros per dollar,what is the real exchange rate?

A country has $100 million of saving and domestic investment of $30 million.What are net exports?

Michel,a Canadian citizen living in Canada,buys $300 of cheese from France.Which statement best identifies the effects of this transaction?

When Canada increases its net capital outflow,it causes Canadian national saving to decrease.

In 2015,Ghana had $4 billion of net exports and bought $1 billion of goods from foreign countries.What were Ghana's components of net exports?

Which of the following is an identity that always holds in an open economy?

Which of the following is an example of Canadian foreign portfolio investment?

In 2006,Canada had positive net exports.What does this fact imply?

Refer to the Table 12-1.What countries in the table does purchasing-power parity hold for?

If the exchange rate changes from 0.35 HYPERLINK "http: / / en.wikipedia.org / wiki / Saudi_riyal" Saudi riyal per dollar to 0.30 HYPERLINK "http: / / en.wikipedia.org / wiki / Saudi_riyal" Saudi riyal per dollar,what has happened to the dollar?

Hungary buys railroad engines from a Canadian firm and pays for them with forints (Hungarian currency).What happens to Canadian net exports and net foreign investment due to this transaction?

Consider this statement: "Canada is characterized by perfect capital mobility." Which of the following best explains what this statement means?