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Question 11.A particular candidate's reelection campaign centers on detailing to her constituents the sum of the balance of trade, which she is unhappy with. What economic term is she referring to?
Question 22._____ transactions are often referred to as foreign or international trade and involve the inflow and outflow of money.
Question 33.A country is spending $1 billion annually on growing its economy, compared to savings of $500 million in the same time period. What type of current account balance does this suggest?
Question 44.You have just arrived at your overseas destination and your first task is to visit the currency exchange. The exchange rate between the dollar and the foreign currency is 1 to .50. You hand the attendant a $100 bill. How much of the foreign currency will you receive back given the current exchange rate?
Question 55.Interest rates are an element of fiscal policy that can affect the exchange rate. Which additional item can affect the exchange rate?
Question 66.Which item is MOST likely to be affected by both fiscal and monetary policies?
Question 77.What type of fiscal policy will cause a decrease in the value of the dollar relative to the exchange rate?
Question 88.A growing economy imports $10 billion and exports $12 billion. What is this country's trade balance?
Question 99.From a trade perspective, balanced trade and money flows would suggest:
Question 1010.A government official recognizes that an overseas country's currency has decreased in value relative to U.S. currency. Therefore, one can conclude that:
Question 1111.A chief economist finds a steady trend of imports from other countries becoming more expensive and the onset of inflation. Which item is MOST likely responsible for these economic events?
Question 1212.As an economics student, you are trying to figure out the reason behind why foreign exports appear to be so cheap relative to domestic goods. What is a potential explanation for this?
Question 1313.American automobile manufacturers are noticing a decrease in their exports to the European market. What rationale BEST explains this outcome?
Question 1414.A country's economic advisers are attempting to make their exports appealing via lowered prices, boost tourism to their country, and attract foreign investors. What economic pathway would they MOST likely consider?
Question 1515.What is a possible economic strategy for a country to broaden the price appeal of their exports?
Question 1616.Several European countries have just submitted their balance of payments upon request by a U.S. diplomat. What is recorded on this document?
Question 1717.The U.S. is attempting to bolster trade with several Asian countries. Our incoming goods appear to be less expensive, suggesting that the local currency _____.
The same pair of shoes can be imported from different countries. The prices of the shoes in Japan, Mexico, England, and India are 3330 Yen, 646 Pesos, 28 Pound Sterling, and 2535 Rupees respectively. The exchange rates are 111 Yen, 17 Pesos, 0.8 Pound Sterling and 65 Rupees to 1 U.S. dollar.
The cheapest pair of shoes can be purchased from:
Question 1919.What would you expect if there is an increase in exchange rate?
Question 2020.All of the following are types of exchange rates that countries can use, except:
Question 2121.What is true about contractionary monetary or fiscal policy?
Question 2222.What is the rate at which one currency is converted in another called?
Question 2323.Which of the following is NOT associated with foreign trade?
Question 2424.Which of the following does NOT impact the trade balance of a country?
Given the following, what is the balance of payments?
Foreign Investment in Domestic sector = $1,000,000
Domestic Investment in Foreign sector = $500,000
Exports = $1,000,000
Imports - $2,000,000
Question 2626.What are goods that are produced in a foreign country but sold in a home country called?
Question 2727.Identify the situation where a weak currency, or lower exchange rate, can be beneficial.
Question 2828.Which exchange rate would most likely be used for a good or service that will be delivered at a future date?
Question 2929.Predict the effect on the exchange rate when the Federal Reserve uses monetary policy to increase income or available money.
Question 3030.Which of the following statements is true?
Foreign Exchange and the Balance of Payments Chapter Exam Instructions
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