Question 1

When Richard from New York buys a Government of Canada bond, the effect on the foreign exchange market is

Accepted Answer

A)  increased demand for U.S. dollars. 
B)  decreased demand for Canadian dollars. 
C)  increased supply of Canadian dollars. 
D)  increased demand for Canadian dollars. 
E)  decreased supply of U.S. dollars. 
A)  increased demand for U.S. dollars. 
B)  decreased demand for Canadian dollars. 
C)  increased supply of Canadian dollars. 
D)  increased demand for Canadian dollars. 
E)  decreased supply of U.S. dollars.

Question 2

According to the law of demand for Canadian dollars, as the exchange rate

Accepted Answer

A)  rises, the quantity demanded of Canadian dollars decreases. 
B)  rises, the demand curve for Canadian dollars shifts leftward. 
C)  falls, the quantity demanded of Canadian dollars decreases. 
D)  falls, the demand curve for Canadian dollars shifts leftward. 
E)  rises or falls, none of above are true. 
A)  rises, the quantity demanded of Canadian dollars decreases. 
B)  rises, the demand curve for Canadian dollars shifts leftward. 
C)  falls, the quantity demanded of Canadian dollars decreases. 
D)  falls, the demand curve for Canadian dollars shifts leftward. 
E)  rises or falls, none of above are true.

Question 3

A weaker Canadian dollar is always preferable to a stronger Canadian dollar.

Accepted Answer

A) True 
 B)False

Question 4

Suppose purchasing power parity (PPP) depends only on hamburgers. The exchange rate is C$1.00 = US$0.80 and hamburger prices are C$2.00 in Canada and US$1.50 in the U.S. PPP suggests that the Canadian dollar is overvalued.

Accepted Answer

A) True 
 B)False

Question 5

Currency speculators sell Canadian dollars whenever they think that the

Accepted Answer

A)  Canadian real interest rates are rising. 
B)  Canadian inflation rate is falling. 
C)  Canadian real GDP is increasing. 
D)  world prices for Canadian resources are falling. 
E)  demand for Canadian dollars is increasing. 
A)  Canadian real interest rates are rising. 
B)  Canadian inflation rate is falling. 
C)  Canadian real GDP is increasing. 
D)  world prices for Canadian resources are falling. 
E)  demand for Canadian dollars is increasing.

When Richard from New York buys a Government of Canada bond, the effect on the foreign exchange market is

According to the law of demand for Canadian dollars, as the exchange rate

A weaker Canadian dollar is always preferable to a stronger Canadian dollar.

Suppose purchasing power parity (PPP) depends only on hamburgers. The exchange rate is C$1.00 = US$0.80 and hamburger prices are C$2.00 in Canada and US$1.50 in the U.S. PPP suggests that the Canadian dollar is overvalued.

Currency speculators sell Canadian dollars whenever they think that the

Whats in Economics for You Scarcity, Opportunity Cost, Trade, and Models

Making Smart Choices: the Law of Demand

Show Me the Money: the Law of Supply

Coordinating Smart Choices: Demand and Supply

Are Your Smart Choices Smart for All Macroeconomics and Microeconomics

Up Around the Circular Flow: Gdp, Economic Growth, and Business Cycles

Costs of Not Working and Living: Unemployment and Inflation

Skating to Where the Puck Is Going: Aggregate Supply and Aggregate Demand

Money Is for Lunatics: Demanders and Suppliers of Money

Steering Blindly Monetary Policy and the Bank of Canada

Spending Others Money: Fiscal Policy, Deficits, and National Debt

Are Sweatshops All Bad Globalization and Trade Policy

Filters

Exam 10: Trading Dollars for Dollars Exchange Rates and Payments With the Rest of the World

When Richard from New York buys a Government of Canada bond, the effect on the foreign exchange market is

According to the law of demand for Canadian dollars, as the exchange rate

A weaker Canadian dollar is always preferable to a stronger Canadian dollar.

Suppose purchasing power parity (PPP) depends only on hamburgers. The exchange rate is C$1.00 = US$0.80 and hamburger prices are C$2.00 in Canada and US$1.50 in the U.S. PPP suggests that the Canadian dollar is overvalued.

Currency speculators sell Canadian dollars whenever they think that the

Whats in Economics for You Scarcity, Opportunity Cost, Trade, and Models

Making Smart Choices: the Law of Demand

Show Me the Money: the Law of Supply

Coordinating Smart Choices: Demand and Supply

Are Your Smart Choices Smart for All Macroeconomics and Microeconomics

Up Around the Circular Flow: Gdp, Economic Growth, and Business Cycles

Costs of Not Working and Living: Unemployment and Inflation

Skating to Where the Puck Is Going: Aggregate Supply and Aggregate Demand

Money Is for Lunatics: Demanders and Suppliers of Money

Steering Blindly Monetary Policy and the Bank of Canada

Spending Others Money: Fiscal Policy, Deficits, and National Debt

Are Sweatshops All Bad Globalization and Trade Policy

Filters