1. Flexible exchange rate systems occur when: 2. If the demand curve for dollars
ID: 1188269 • Letter: 1
Question
1. Flexible exchange rate systems occur when:
2. If the demand curve for dollars shifts to the right:
3. If the supply curve for dollars shifts to the right relativeto the British pound:
4. With a system of flexible floating exchange rates, a UnitedStates trade deficit with Japan will lead to:
5. When the dollar appreciates, it means that:
6. Which of the following is a likely consequence when thedollar declines in value against other currencies?
7. If fewer dollars are needed to buy a German mark:
8. Other things equal, higher U.S. income would:
9. With a system of floating exchange rates,holding everything else constant, a Mexican trade deficit with theUnited States will result in:
10. Consider the impact on Ford autos producedin the U.S. and exported to Mexico, when the Mexican pesodepreciated in the mid-1990s. The most likely consequences for Fordis:
11.. Which of the following was a consequence tothe Mexican economy of the mid-1990s peso collapse.
12. If Japanese banks sell their U.S. assetssuch as Treasury debt, which of the following is true:
13. When a country's real exchange rateappreciates:
Explanation / Answer
Exchange rates are determined by the law of supply anddemand.
The dollar has appreciated.
The value of the dollar has depreciated
A decrease in the balance of gold held by the UnitedStates.
It takes fewer dollars to purchase foreign currencies
The U.S. current account trade deficit increases
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