1.Suppose the US$/EURO exchange rate falls. Then A.French firms will import more from the United States into France. B.the dollar is less valuable relative to the euro. C.U.S. firms will export less to France. D.the euro is more valuable relative to the dollar. 2.In a flexible-exchange-rate system, the value of a currency is determined by A.the government. B.the intersection of the IS and LM curves. C.Swiss gnomes. D.the demand and supply for the currency in the foreign exchange market. 3.Under a flexible-exchange-rate system, an increase in the demand for Japanese Yen would cause the U.S. dollar/Japanese yen exchange rate to A.fall B.rise C.remain unchanged, because supply also increases. D.remain unchanged, because the exchange rate is set by the central bank. 4.There’s been a real depreciation of the dollar over the past month. In the long run, you would expect the quantity of A.American imports to fall and the quantity of American exports to fall. B.American imports to rise and the quantity of American exports to rise. C.American imports to rise and the quantity of American exports to fall. D.American imports to fall and the quantity of American exports to rise. 5.When the euro falls in value relative to other currencies, then A.European exports rise in price. B.neither European exports nor imports rise in price. C.goods imported into Europe rise in price. D.both European exports and imports rise in price.
1.Suppose the US$/EURO exchange rate falls. Then
A.French firms will import more from the United States into France.
B.the dollar is less valuable relative to the euro.
C.U.S. firms will export less to France.
D.the euro is more valuable relative to the dollar.
2.In a flexible-exchange-rate system, the value of a currency is determined by
A.the government.
B.the intersection of the IS and LM
C.Swiss gnomes.
D.the
3.Under a flexible-exchange-rate system, an increase in the demand for Japanese Yen would cause the U.S. dollar/Japanese yen exchange rate to
A.fall
B.rise
C.remain unchanged, because supply also increases.
D.remain unchanged, because the exchange rate is set by the central bank.
4.There’s been a real
A.American imports to fall and the quantity of American exports to fall.
B.American imports to rise and the quantity of American exports to rise.
C.American imports to rise and the quantity of American exports to fall.
D.American imports to fall and the quantity of American exports to rise.
5.When the euro falls in value relative to other currencies, then
A.European exports rise in
B.neither European exports nor imports rise in price.
C.goods imported into Europe rise in price.
D.both European exports and imports rise in price.
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