1)The exchange rate is the: A) Opportunity cost at which goods are produced dome

ID: 2702639 • Letter: 1

Question

1)The exchange rate is the:

A) Opportunity cost at which goods are produced domestically.

B) Balance-of-trade ratio of one country to another.

C) Price of one country's currency expressed in terms of another country's currency.

D) Amount of currency that can be purchased with 1 ounce of gold.

2) An exchange rate is:

A) Always fixed. C) The price of one currency in terms of another.

B) Tied to the price of gold. D) All of the above.

3)The U.S. demand for foreign currency represents:

A) A demand for U.S. dollars.

B) A supply of U.S. dollars.

C) The foreign demand for U.S. exports.

D) A point of disequilibrium in the foreign-exchange market

4)The U.S. demand for foreign currency arises from speculation and the:

A) U.S. demand for foreign goods, services, and financial assets.

B) Foreign demand for United States goods, services, and financial assets.

C) Foreign demand for United States holdings of gold.

D) Supply of goods and services from the United States.

1)C

2)C

3)B

4)A

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