Multiple Choice
In a floating exchange rate regime,the exchange rate is the equilibrium price of the currency.Changes in supply for a currency will cause changes in the equilibrium exchange rate.Which of these statements in relation to the AUD supply curve in the FX market is incorrect?
A) For AUD holders, a rise in the price of foreign exchange means foreign currency priced goods, services and assets become cheaper.
B) The AUD supply curve is upward-sloping, reflecting the demand for foreign currency by AUD holders.
C) Supply of AUD onto the FX market rises as holders of AUD buy foreign currency.
D) As the price of the AUD increases, the price of the foreign currency falls.
Correct Answer:
Verified
Correct Answer:
Verified
Q70: All else being equal,a significant appreciation of
Q71: Consider a textbook situation in which Australia
Q72: On a foreign exchange diagram of the
Q73: With the USD/AUD currency pair,an increase in
Q74: If the currency AUD/USD moves from 0.9527-32
Q76: If foreign interest rates increase relative to
Q77: If one country is experiencing prolonged lower
Q78: According to the text,if Australia's national income
Q79: The theory of purchasing power parity seeks
Q80: In determining the equilibrium exchange rate,the supply