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Unformatted text preview: ANSWER OUTLINE ECONOMICS 353 L. Tesfatsion/Fall 06 EXERCISE 10: Six Questions (8 Points Total) DUE: Tuesday, Dec 5, 2006, 2:10pm **IMPORTANT REMINDER: LATE ASSIGNMENTS WILL NOT BE ACCEPTED – NO EXCEPTIONS** EXERCISE INSTRUCTIONS: • (1) Please fill in your name and student ID number on Side 1 of your bubble sheet and write 353-Ex10 in the top margin of Side 1. • (2) Use a number 2 pencil to mark your answers on Side 1 of the bubble sheet to the first five questions Q1 through Q5, below, which are in multiple choice format. • (3) The sixth question Q6 is a Web Exercise that asks you to consider the microcredit move- ment (e.g. Grameen Banking), whose founder Dr. Muhammad Yunus just won the 2006 Nobel Peace Prize. Please put your name and student ID number at the top of your answer sheet for Q6 along with 353-Ex10:Q6 and separately hand in this answer sheet for Q6 in addition to your answer bubble sheet for questions Q1 through Q5. • (4) Each question Q1 through Q5 is worth 1 point, and Q6 is worth 3 points. Q1 ( 1 Point). A depreciation of a country’s domestic currency the cost of foreign goods relative to domestic goods. Consequently, central banks sometimes attempt to offset de- preciations of their domestic currencies by their own currency in the foreign exchange market. A. raises; selling B B. raises; buying C. lowers; buying D. lowers; selling E. none of the above Q2 (1 point). A persistent U.S. current account indicates that the U.S. is DECREASING its net claims on foreign assets because the U.S. is persistently the rest of the world. A. deficit; lending (in net terms) to B B. deficit; borrowing (in net terms) from C. surplus; lending (in net terms) to D. surplus; borrowing (in net terms) from 1 Q3 (1 Point). As conventionally defined in GDP national income accounting in the United States, the U.S. CAPITAL ACCOUNT keeps track of A. (U.S. net exports)+(net factor payments to the U.S.)+(net transfers to U.S.) B. all current purchases by U.S. citizens from the rest of the world.all current purchases by U....
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This note was uploaded on 04/30/2011 for the course ECON 234 taught by Professor Koki during the Spring '11 term at Punjab Engineering College.
- Spring '11