When there is a surplus of dollars in the foreign exchange market, O A. the demand for Canadian dollars will increase so the foreign exchange market can move into equilibrium O B. prices in Canada will fall relative to prices in the United States OC. the supply of Canadian dollars will increase so the foreign exchange market can move into equilibrium O D. the forces of supply and demand pull the foreign exchange market into equilibrium

When there is a surplus of dollars in the foreign exchange market, O A. the demand for Canadian dollars will increase so the foreign exchange market can move into equilibrium O B. prices in Canada will fall relative to prices in the United States OC. the supply of Canadian dollars will increase so the foreign exchange market can move into equilibrium O D. the forces of supply and demand pull the foreign exchange market into equilibrium

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Suppose that Great Britain and the United States are trading partners. Assume that the initial exchange rate in Great Britain is £0.76= 1$. Now suppose that the opportunity cost of consumption in the United States begin to rise. Which of the following explain what is expected to happen in the British forex market? O The demand for British pounds will decrease, leading to a depreciation of the US dollar. O The supply of British pounds will increase, leading to an appreciation of the British pound. O The supply of American dollars will decrease, leading to a depreciation of the British pound. O The demand for American dollars will decrease, leading to an appreciation of the British pound. Please do fast ASAP fast
A 216.
The capital-service account is the section of the account that records the a. Current; income paid to foreign owners of assets in Canada and income received by Canadians for assets located abroad. O b. Capitalt; the foreign-exchange reserves held by the Bank of Canada. O c. Current; the interest charges and earnings of Canadian importers and exporters. O d. Current; the financial reserves held by the Bank of Canada which they can use in the foreign-exchange market. e. Capital; the net change in Canadian investments abroad and the net change in foreign investments in Canada.
You observe the following exchange rates Spot GBP/EUR exchange rate 1.120 € per £ 3 month GBP/EUR forward rate 1.115 Which of the following statements is likely to be true? Select one: O a. Neither of the other options O b. UK interest rates are lower than Eurozone interest rates O c. Speculators are expecting GBP to depreciate against EUR for the next year. d. UK interest rates arhigher than Eurozone interest rates. O e. Speculators are expecting GBP to appreciate against EUR for the next year.
When Americans start exporting more, in the short run we tend to see the price level and equilibrium output O fall; fall O rise; fall O rise; rise Ofall: rise
Figure 13-2 Real Interest Rate World interest rate, fo Real Exchange Rate E₁ 토 Supply of Loara ble Funds Demand for Loa rable Funds Quantity of Loanable Funds Supply of Canadian Dollars (S-1) Do Quantity of Dollars Refer to the Figure 13-2. If the economy were initially in equilibrium at r0 and EO and the government removed import quotas, what would happen to the exchange rate? a. It would appreciate to El. b. It would appreciate to E2. C. It would depreciate to El. d. It would depreciate to E2.