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chap038 - CHAPTER 38 Exchange Rates the Balance of Payments...

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CHAPTER 38 Exchange Rates, the Balance of Payments, and Trade Deficits Topic Question numbers ___________________________________________________________________________________________________ 1. Financing international trade 1-8 2. Balance of payments 9-64 3. Exchange rates 65-78 4. Floating exchange rates; fixed exchange rates 79-113 5. Gold standard 114-120 6. Bretton Woods system 121-123 7. Managed float 124-132 8. U.S. trade deficits 133-140 Consider This 141-142 Last Word 143-145 True-False 146-163 ___________________________________________________________________________________________________ Multiple Choice Questions Financing international trade Type: A Topic: 1 E: 712 MI: 468 MA: 378 1. U.S. export transactions create: A) a U.S. demand for foreign monies and the satisfaction of this demand decreases the supplies of dollars held by foreign banks. B) a U.S. demand for foreign monies and the satisfaction of this demand increases the supplies of dollars held by foreign banks. C) a foreign demand for dollars and the satisfaction of this demand decreases the supplies of foreign monies held by U.S. banks. D) a foreign demand for dollars and the satisfaction of this demand increases the supplies of foreign monies held by U.S. banks. Answer: D Type: A Topic: 1 E: 712 MI: 468 MA: 378 2. U.S. import transactions create:
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3. If a U.S. importer can purchase 10,000 pounds for $20,000, the rate of exchange is: Type: A Topic: 1 E: 712 MI: 468 MA: 378 4. Which of the following creates a supply of Canadian dollars in foreign exchange markets? Type: A Topic: 1 E: 712 MI: 468 MA: 378 5. Other things equal, the financing of a U.S. export transaction: A) reduces U.S. interest rates. B) decreases the supplies of foreign currency held by United States banks. C) decreases GDP in the United States. D) increases the supplies of foreign currency held by U.S. banks. Answer: D Type: A Topic: 1 E: 712 MI: 468 MA: 378
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