ECON5327_Quiz3_key_SS09

ECON5327_Quiz3_key_SS09 - ECON 5327 International Finance...

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International Finance Quiz #3 1. The real exchange rate ρ t is equal to, a. S t (P t /P t * ) b. S t (P t * /P t ) c. S t P t d. S t P t * e. None of the above. 2. If absolute PPP holds, then which of the following will be true? a. Ex-Ante PPP is violated. b. Relative PPP is violated. c. The real exchange rate is equal to one. d. All are true. e. None of the above is true. 3. Which of the following is not a reason that PPP will be violated? a. Tariffs. b. Transportation costs. c. Non-traded goods. d. Productivity shocks. e. None of the above. 4. A common element among the “Fair Trade” and “Illegal Immigration” problems is: a. a bunch of kids causing problems. b. a lack of government involvement. c. neither impacts Texas substantially. d. government policies distorting market outcomes. e. All of the above. 5. If the forward rate is an unbiased predictor of the future spot rate, which of the following is also true? a.
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This note was uploaded on 07/16/2011 for the course ECON 5319 taught by Professor Crowder during the Spring '11 term at UT Arlington.

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ECON5327_Quiz3_key_SS09 - ECON 5327 International Finance...

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