Question 1

If the inflation rate in the U.S.is higher than in other countries,the value of the dollar in international currency markets will be expected to

Accepted Answer

A)  remain unchanged.
B)  rise.
C)  fall.
D)  change in a manner that cannot be determined without information concerning the magnitudes of the shifts in the demand for and supply of dollars on international currency markets.E) A) and B)
F) B) and D)

Question 2

The gold standard had two main drawbacks: (1)______________ and (2)_____________.

Accepted Answer

(1) It will work only if parti...

Question 3

In April 2010,you needed about ________ euro to get $1.00.

Accepted Answer

The answer of In April 2010,you needed about ________ euro...

Question 4

Which statement is false?

Accepted Answer

A)  Our balance of payments is the entire flow of U.S.dollars and foreign currencies into and out of the country.
B)  Our trade balance is just the difference between our imports and our exports.
C)  Our trade balance has been negative since the mid-1970s.
D)  None of these statements is falseE) All of the above
F) B) and C)

Question 5

Under a gold standard,a country with a trade deficit should expect gold to flow _______.

Accepted Answer

The answer of Under a gold standard,a country with a...

Question 6

Statement I: China and Japan have continued to finance the huge U.S.trade deficit because the large American consumer market allows them to expand their production and create jobs for their citizens.
Statement II: China and Japan finance over half the U.S."twin deficits," the trade and federal budget deficits.

Accepted Answer

A)  Statement I is true and statement II is false.
B)  Statement II is true and statement I is false.
C)  Both statements are true.
D)  Both statements are false.E) A) and D)
F) None of the above

Question 7

Between the summer of 2005 and April 2008,the Chinese yuan ___ against the U.S.dollar

Accepted Answer

A)  appreciated by 5%.
B)  appreciated by 21%.
C)  depreciated by 5%.
D)  depreciated by 20%.E) C) and D)
F) B) and C)

Question 8

The free floating exchange rate system has been in effect since

Accepted Answer

A)  1900.
B)  1933.
C)  1945.
D)  1973.
E)  1985.F) B) and D)
G) A) and D)

Question 9

Suppose the exchange rate is initially set at 120 yen per dollar and increases to 140 yen per dollar.In the U.S.economy this would be expected to

Accepted Answer

A)  increase the U.S.trade deficit (or decrease the trade surplus) .
B)  decrease the U.S.trade deficit (or increase the trade surplus) .
C)  increase the U.S.trade deficit only if exports change by more than imports.
D)  leave the U.S.trade deficit unchanged.
E)  decrease the U.S.trade deficit only if exports change by more than imports.F) C) and E)
G) A) and D)

Question 10

Suppose the exchange rate is initially set at 120 yen per dollar and increases to 140 yen per dollar.This would be expected to cause the price of Japanese goods in the U.S.economy to

Accepted Answer

A)  decrease.
B)  change in a manner that cannot be determined without additional information.
C)  remain the same since domestic demand remains the same.
D)  increase.E) C) and D)
F) A) and D)

Question 11

Which statement is false?

Accepted Answer

A)  Foreigners have reinvested most of the dollars they have earned trading with us in U.S.government and corporate securities,real estate,and direct investment in plant and equipment.
B)  Until the early 1980s Americans were investing much more in foreign countries than foreigners were in the United States.
C)  Our capital and current accounts add up to zero.
D)  None of these statements is false.E) All of the above
F) C) and D)

Question 12

If 1 U.S.dollar exchanges for 46.94 Indian rupees,how much would it cost in rupees to purchase a copy of Time Magazine priced at $2.50?

Accepted Answer

2.50 x 46....

Question 13

Statement I: Our balance of trade is part of our current account balance.
Statement II: Our balance of payments is part of our balance of trade.

Accepted Answer

A)  Statement I is true and statement II is false.
B)  Statement II is true and statement I is false.
C)  Both statements are true.
D)  Both statements are false.E) B) and C)
F) A) and C)

Question 14

Statement I: We are currently on the gold standard.
Statement II: Our current account deficit is about 3% of our GDP.

Accepted Answer

A)  Statement I is true and statement II is false.
B)  Statement II is true and statement I is false.
C)  Both statements are true.
D)  Both statements are false.E) A) and D)
F) None of the above

Question 15

There must always be a balance of a nation's

Accepted Answer

A)  merchandise exports and gold imports.
B)  total international payments.
C)  imports and exports of goods and services.
D)  merchandise imports and exports.E) None of the above
F) B) and D)

Question 16

Each of the following is a requirement of a gold standard except

Accepted Answer

A)  a nation defines its currency in terms of gold.
B)  a nation's money supply is made up of gold or gold certificates.
C)  a nation must maintain a fixed ratio between its gold stock and its money supply.
D)  there must be no barriers to the free flow of gold into and out of the country.E) B) and C)
F) A) and B)

Question 17

If the U.S.demand for German goods increases,then

Accepted Answer

A)  the U.S.current account deficit with Germany will improve.
B)  Germany will experience currency devaluation.
C)  the U.S.dollar will appreciate in value against the euro.
D)  the euro will depreciate in value against the U.S.dollar.
E)  the euro will appreciate in value against the U.S.dollar.F) A) and C)
G) All of the above

Question 18

In 2009,our current account deficit was $___________ billion.

Accepted Answer

The answer of In 2009,our current account deficit was $___________...

Question 19

If the dollar rose by 35% relative to other currencies,our current account deficit would

Accepted Answer

A)  rise sharply.
B)  rise slightly.
C)  not be affected.
D)  fall slightly.
E)  fall sharply.F) B) and C)
G) C) and E)

Question 20

Statement I: The gold standard will not work well when the world's gold supply does not increase as quickly as the world's need for money.
Statement II: The years the world used the gold standard were the closest the world has ever come to having an international currency.

Accepted Answer

A)  Statement I is true and statement II is false.
B)  Statement II is true and statement I is false.
C)  Both statements are true.
D)  Both statements are false.E) None of the above
F) C) and D)

Exam 32: International Finance

Correct Answer
verified

If the dollar rose by 35% relative to other currencies,our current account deficit would

Correct Answer
verified

Statement I: Our balance of trade is part of our current account balance. Statement II: Our balance of payments is part of our balance of trade.

Correct Answer
verified

Under a gold standard,a country with a trade deficit should expect gold to flow _______.

Correct Answer
verified

The gold standard had two main drawbacks: (1)__ and (2)_.

Correct Answer
verified
(1) It will work only if parti...
View Answer

If 1 U.S.dollar exchanges for 46.94 Indian rupees,how much would it cost in rupees to purchase a copy of Time Magazine priced at $2.50?

Correct Answer
verified
2.50 x 46....
View Answer

Which statement is false?

Correct Answer
verified

Suppose the exchange rate is initially set at 120 yen per dollar and increases to 140 yen per dollar.In the U.S.economy this would be expected to

Correct Answer
verified

There must always be a balance of a nation's

Correct Answer
verified

Between the summer of 2005 and April 2008,the Chinese yuan ___ against the U.S.dollar

Correct Answer
verified

Statement I: We are currently on the gold standard. Statement II: Our current account deficit is about 3% of our GDP.

Correct Answer
verified

Which statement is false?

Correct Answer
verified

In 2009,our current account deficit was $___________ billion.

Correct Answer
verified

Suppose the exchange rate is initially set at 120 yen per dollar and increases to 140 yen per dollar.This would be expected to cause the price of Japanese goods in the U.S.economy to

Correct Answer
verified

If the inflation rate in the U.S.is higher than in other countries,the value of the dollar in international currency markets will be expected to

Correct Answer
verified

The free floating exchange rate system has been in effect since

Correct Answer
verified

Statement I: The gold standard will not work well when the world's gold supply does not increase as quickly as the world's need for money. Statement II: The years the world used the gold standard were the closest the world has ever come to having an international currency.

Correct Answer
verified

Each of the following is a requirement of a gold standard except

Correct Answer
verified

If the U.S.demand for German goods increases,then

Correct Answer
verified

In April 2010,you needed about ________ euro to get $1.00.

Correct Answer
verified

Exam 32: International Finance

Correct AnswerverifiedShow Answer

If the dollar rose by 35% relative to other currencies,our current account deficit would

Correct AnswerverifiedShow Answer

Statement I: Our balance of trade is part of our current account balance. Statement II: Our balance of payments is part of our balance of trade.

Correct AnswerverifiedShow Answer

Under a gold standard,a country with a trade deficit should expect gold to flow _______.

Correct AnswerverifiedShow Answer

The gold standard had two main drawbacks: (1)______________ and (2)_____________.

Correct Answerverified(1) It will work only if parti...View AnswerShow Answer

If 1 U.S.dollar exchanges for 46.94 Indian rupees,how much would it cost in rupees to purchase a copy of Time Magazine priced at $2.50?

Correct Answerverified2.50 x 46....View AnswerShow Answer

Which statement is false?

Correct AnswerverifiedShow Answer

Suppose the exchange rate is initially set at 120 yen per dollar and increases to 140 yen per dollar.In the U.S.economy this would be expected to

Correct AnswerverifiedShow Answer

There must always be a balance of a nation's

Correct AnswerverifiedShow Answer

Between the summer of 2005 and April 2008,the Chinese yuan ___ against the U.S.dollar

Correct AnswerverifiedShow Answer

Statement I: We are currently on the gold standard. Statement II: Our current account deficit is about 3% of our GDP.

Correct AnswerverifiedShow Answer

Which statement is false?

Correct AnswerverifiedShow Answer

In 2009,our current account deficit was $___________ billion.

Correct AnswerverifiedShow Answer

Suppose the exchange rate is initially set at 120 yen per dollar and increases to 140 yen per dollar.This would be expected to cause the price of Japanese goods in the U.S.economy to

Correct AnswerverifiedShow Answer

If the inflation rate in the U.S.is higher than in other countries,the value of the dollar in international currency markets will be expected to

Correct AnswerverifiedShow Answer

The free floating exchange rate system has been in effect since

Correct AnswerverifiedShow Answer

Statement I: The gold standard will not work well when the world's gold supply does not increase as quickly as the world's need for money. Statement II: The years the world used the gold standard were the closest the world has ever come to having an international currency.

Correct AnswerverifiedShow Answer

Each of the following is a requirement of a gold standard except

Correct AnswerverifiedShow Answer

If the U.S.demand for German goods increases,then

Correct AnswerverifiedShow Answer

In April 2010,you needed about ________ euro to get $1.00.

Correct AnswerverifiedShow Answer

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Correct Answer
verified

The gold standard had two main drawbacks: (1)__ and (2)_.

Correct Answer
verified
(1) It will work only if parti...
View Answer

Correct Answer
verified
2.50 x 46....
View Answer

Correct Answer
verified

Correct Answer
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