Quiz 8 - Quiz 8 1. The Federal Reserve Bank uses open...

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
Quiz 8 1. The Federal Reserve Bank uses open market operations to directly affect: a. Consumption b. The money supply c. Government purchases d. Investment e. Capital Outflows Answer: b 2. In order to free up its financial markets and join the world financial and monetary system, a country needs to do all of the following except: a. Open up movements of goods b. Open up currency transactions c. Have uniform fiscal and monetary policies d. Open up capital movements Answer: c 3. The macroeconomic policy trilemma regarding exchange rate policies is that monetary authorities cannot: a) pursue independent monetary policy while maintaining a fixed exchange rate and allowing free capital movements b) maintain a fixed exchange rate while pursuing an independent monetary policy and allowing free movements of capital c) allow free movements of capital while pursuing an independent monetary policy and maintaining a fixed exchange rate d) All of the above Answer: d 4. Suppose that the one year Swiss franc interest rate is 5% and the one year U.K. interest rate is
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

Page1 / 3

Quiz 8 - Quiz 8 1. The Federal Reserve Bank uses open...

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online