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Quiz - Chapters 7 and 26

# Quiz - Chapters 7 and 26 - Points Awarded 120.00 Points...

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Points Awarded 120.00 Points Missed 0.00 Percentage 100% 1. A factor helping determine demand for the dollar in the foreign exchange market is A) the expected future exchange rate. B) the expected future interest rate. C) the level of U.S. imports. D) the supply of U.S. dollars. Points Earned: 1.0/1.0 Correct Answer(s): A 2. A factor determining the supply of U.S. dollars in the foreign exchange market is Points Earned: 1.0/1.0 Correct Answer(s): A

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3. If the equilibrium exchange rate for the dollar is 110 yen per dollar and the current exchange rate is 120 yen per dollar, then the Points Earned: 1.0/1.0 Correct Answer(s): B 4. Suppose the current exchange rate between the euro and the United States dollar is 1.15 euros per dollar. If interest rates in the United States increase and interest rates in Europe remain unchanged then Points Earned: 1.0/1.0 Correct Answer(s): A
5. When the U.S. interest rate rises relative to that in other counties, in the foreign exchange market the demand for U.S. dollars ________ and the supply of U.S. dollars ________. A) increases; increases B) increases; decreases C) decreases; increases D) decreases; decreases Points Earned: 1.0/1.0 Correct Answer(s): B 6. Using the above figure, which of the following is correct? Points Earned: 1.0/1.0 Correct Answer(s): D 7. Suppose the exchange rate between the U.S. dollar and the Jamaican dollar was \$1 U.S. = \$40 Jamaican dollars. A beach towel sells for \$20 in Miami and \$60 Jamaican in Negril.

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Points Earned: 1.0/1.0 Correct Answer(s): D
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Quiz - Chapters 7 and 26 - Points Awarded 120.00 Points...

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