02 - 02 Student 1 The international monetary system can be defined as the institutional framework within which A international payments are made B

02 - 02 Student 1 The international monetary system can be...

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02Student: ___________________________________________________________________________ 1.The international monetary system can be defined as the institutional framework within which: A. international payments are madeB. movement of capital is accommodatedC. exchange rates among currencies are determinedD. all of the above 2.Corporations today are operating in an environment in which exchange rate changes may adversely affect their competitive positions in the marketplace. This situation, in turn, makes it necessary for many firms to 3.The international monetary system went through several distinct stages of evolution. These stages are summarized, in alphabetic order, as follows(i) Bimetallism(ii) Bretton Woods system(iii) Classical gold standard(iv) Flexible exchange rate regime(v) Interwar periodThe chronological order that they actually occurred is: 4.In the United States, bimetallism was adopted by the Coinage Act of 1792 and remained a legal standard until 1873, 5.The monetary system of bimetallism is unstable. Due to the fluctuation of the commercial value of the metals, A. the metal with a commercial value lower than the currency value tends to be used as metal and is withdrawn from circulation as money (Gresham's Law).B.the metal with a commercial value higher than the currency value tends to be used as money (Gresham's Law).C. D. None of the abovethe metal with a commercial value higher than the currency value tends to be used as metal and is withdrawn from circulation as money (Gresham's Law).6.In the 1850s the French franc was valued by both gold and silver, under the official French ratio which equated a gold franc to a silver franc 15½ times as heavy. At the same time, the gold from newly discovered mines in California poured into the market, depressing the value of gold. As a result,

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