Exam 18: Fixed Exchange Rates and Foreign Exchange Intervention

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Describe the effect of the 2008-2009 global financial crisis on the Swiss franc and the central bank's efforts to respond to the resulting problems.

(Essay)

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Question 21

Please describe in detail a self-fulfilling currency crisis.

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Question 22

The signaling effect of foreign exchange intervention

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Question 23

The global financial crisis of 2007-2008 resulted in a(n) of the Swiss franc as foreign currency flowed the country. As result, Swiss products became competitive in world markets.

(Multiple Choice)

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Question 24

What is the expected dollar rate of return on dollar deposits if today's exchange rate is $1.10 per euro, next year's expected exchange rate is $1.165 per euro, the dollar interest rate is 10%, and the euro interest rate is 5%?

(Multiple Choice)

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Question 25

Under the gold standard, if the dollar price of gold is pegged at $35 per ounce and the dollar/euro exchange rate is set at $2.40 per euro, what must the euro price of gold be pegged at?

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Question 26

From 1837 and up until the Civil War, the United States adhered to a

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Question 27

Use a figure to explain how a balance of payments crisis and its hand in capital flight.

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Question 28

When a country's currency is devalued

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Question 29

In the interest rate parity condition with imperfect substitutes and a risk premium of ρ

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Question 30

Which one of the following statements is the MOST accurate?

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Question 31

Industrialized countries typically their floating exchange rates. Developing countries often their floating exchange rates.

(Multiple Choice)

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Question 32

A central bank's international reserves consists of its holdings of

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Question 33

A system of managed floating exchange rates is

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Question 34

The global financial crisis of 2007-2008 resulted in a(n) of the Swiss franc. In 2011, the Swiss central bank intervened in order to cause a(n) of the franc.

(Multiple Choice)

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Question 35

Which one of the following statements is the MOST accurate?

(Multiple Choice)

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Question 36

The main reason(s) why governments sometimes chose to devalue their currencies is (are)

(Multiple Choice)

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Question 37

If assets are imperfect substitutes, then a decrease in the amount of domestic currency bonds held by the public will the risk premium and the amount of domestic currency bonds held by the central bank.

(Multiple Choice)

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Question 38

Under fixed exchange rates, which one of the following statements is the MOST accurate?

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Question 39

Explain how a country whose currency is the reserve currency can use monetary policy for macroeconomic stabilization. In particular, explain the result if that country doubled its domestic money supply.

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Question 40

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Exam 18: Fixed Exchange Rates and Foreign Exchange Intervention

Describe the effect of the 2008-2009 global financial crisis on the Swiss franc and the central bank's efforts to respond to the resulting problems.

Please describe in detail a self-fulfilling currency crisis.

The signaling effect of foreign exchange intervention

The global financial crisis of 2007-2008 resulted in a(n) ________ of the Swiss franc as foreign currency flowed ________ the country. As result, Swiss products became ________ competitive in world markets.

What is the expected dollar rate of return on dollar deposits if today's exchange rate is $1.10 per euro, next year's expected exchange rate is $1.165 per euro, the dollar interest rate is 10%, and the euro interest rate is 5%?

Under the gold standard, if the dollar price of gold is pegged at $35 per ounce and the dollar/euro exchange rate is set at $2.40 per euro, what must the euro price of gold be pegged at?

From 1837 and up until the Civil War, the United States adhered to a

Use a figure to explain how a balance of payments crisis and its hand in capital flight.

When a country's currency is devalued

In the interest rate parity condition with imperfect substitutes and a risk premium of ρ

Which one of the following statements is the MOST accurate?

Industrialized countries typically ________ their floating exchange rates. Developing countries often ________ their floating exchange rates.

A central bank's international reserves consists of its holdings of

A system of managed floating exchange rates is

The global financial crisis of 2007-2008 resulted in a(n) ________ of the Swiss franc. In 2011, the Swiss central bank intervened in order to cause a(n) ________ of the franc.

Which one of the following statements is the MOST accurate?

The main reason(s) why governments sometimes chose to devalue their currencies is (are)

If assets are imperfect substitutes, then a decrease in the amount of domestic currency bonds held by the public will ________ the risk premium and ________ the amount of domestic currency bonds held by the central bank.

Under fixed exchange rates, which one of the following statements is the MOST accurate?

Explain how a country whose currency is the reserve currency can use monetary policy for macroeconomic stabilization. In particular, explain the result if that country doubled its domestic money supply.

Introduction

World Trade: an Overview

Labor Productivity and Comparative Advantage: the Ricardian Model

Specific Factors and Income Distribution

Resources and Trade: the Heckscher-Ohlin Model

The Standard Trade Model

External Economies of Scale and the International Location of Production

Firms in the Global Economy: Export Decisions, Outsourcing, and Multinational Enterprises

The Instruments of Trade Policy

The Political Economy of Trade Policy

Trade Policy in Developing Countries

Controversies in Trade Policy

National Income Accounting and the Balance of Payments

Exchange Rates and the Foreign Exchange Market: an Asset Approach

Money, Interest Rates, and Exchange Rates

Price Levels and the Exchange Rate in the Long Run

Output and the Exchange Rate in the Short Run

International Monetary Systems: an Historical Overview

Financial Globalization: Opportunity and Crisis

Optimum Currency Areas and the Euro

Developing Countries: Growth, Crisis, and Reform

Filters

The global financial crisis of 2007-2008 resulted in a(n) of the Swiss franc as foreign currency flowed the country. As result, Swiss products became competitive in world markets.

Industrialized countries typically their floating exchange rates. Developing countries often their floating exchange rates.

The global financial crisis of 2007-2008 resulted in a(n) of the Swiss franc. In 2011, the Swiss central bank intervened in order to cause a(n) of the franc.

If assets are imperfect substitutes, then a decrease in the amount of domestic currency bonds held by the public will the risk premium and the amount of domestic currency bonds held by the central bank.