Which of the following curve(s) is drawn vertically on a currency or foreign exchange market graph? Group of answer choices 1No curve is vertical in the currency exchange market graph. 2The supply curve. 3The demand curve. 4There is a curve that is vertical but it is neither the supply curve nor the demand curve.
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Which of the following curve(s) is drawn vertically on a currency or foreign exchange market graph?
Group of answer choices
1No curve is vertical in the currency exchange market graph.
2The
3The demand curve.
4There is a curve that is vertical but it is neither the supply curve nor the demand curve.
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- Using Demand and Supply Analysis. Use the line drawing tool to show the effects of an increase in Japanese interest rates on the exchange rate between the British pound and the Japanese yen. ¥ The vertical axis will be yen per pound, I Draw and properly label a single line. Carefully follow the instructions above, and only draw the required object. 400- 350- 300- 250- 200- 150- 100- 50- The Market for Pounds Yen per Pound A Pounds SE DE QWhat effect would a devaluation of a country's currency most likely have on its export volumes? A. Export volumes would decrease, as goods become more expensive in foreign markets. B. Export volumes would increase, as goods become cheaper in foreign markets. C. Export volumes would remain unchanged, as currency value does not affect trade. D. Export volumes would initially decrease, but then increase over time due to adjustments in trade agreements."Roman Abramovitch" lecture: you must answer all questions. Displayed above is the (spot) foreign exchange market for the pound sterling and the GIG, the national currency of the country High Tech. At the initial equilibrium point X, 1 Pound 5 Gigs. Please answer the following questions: GIGS S₂ = 1 X O Z Se= DGIGS SE = DGIGS DE = SGIGS DE = SGIGS Billions of Pounds 1. Why does the supply curve for pounds slope upward? 2. Starting from an initial equilibrium of point X, consider a new, 5 billion pounds of capital inflow to High Tech. Under what situation would the new equilibrium be at point Y versus point Z? 3. Compare the (numerical) size of the monetary base or high-powered Money (Mo) at points X and Z. 4. If we knew that the money multiplier equals 2 and that the central bank of Freedonia had fully sterilized the capital inflow, could we estimate by how much real GDP would increase? 5. If the central bank decided instead not to sterilize, would the nominal or real gig exchange rate…
- Which of the following would increase the U.S. demand for foreign currency? a. an increase in U.S. real interest rate b. an increase in incomes abroad c. a decrease in the U.S. demand for foreign goods d. an increase in the U.S. demand for foreign goods e. a decrease in U.S. income O Icon Key Ox 0 F8 F9 prt sc F10Question 4Use the money market and FX diagrams to answer the following questions about the relationshipbetween the British pound and the U.S. dollar. The exchange rate is in U.S. dollars per Britishpound, E$/pound. We want to consider how a change in the U.S. money supply affects interestrates and exchange rates. On all graphs, label the initial equilibrium point A.(a) Illustrate how a temporary increase in the U.S. money supply affects the money and FXmarkets. Label your short-run equilibrium point B and your long-run equilibrium point C.(b) Using your diagram from (a), state how each of the following variables changes in theshort run (increase/decrease/no change): U.S. interest rate, British interest rate, E$/pound,Ee$/pound, and the U.S. price level P.(c) Using your diagram from (a), state how each of the following variables changes in thelong run (increase/decrease/no change relative to their initial values at point A): U.S. interestrate, British interest rate, E$/pound, Ee$/pound,…Only like if no ai or downvoted for ai content Suppose that the equilibrium exchange rate between the United States and South African is 15.13 Rand per US dollar. Further suppose that the two countries are trading partners with each other. Inflation now rises in South Africa. Which of the following answer choices correctly represents the shift that would occur in the US foreign exchange market? The supply of US dollars would fall. The demand for South African Rands would rise. The supply of South African Rands would rise.
- Suppose that, initially, the foreign exchange market between the United States and Canada is in equilibrium. Suppose that preferences for goods made in Canada change in the United States, causing U.S. consumers to purchase fewer goods and services made in Canada. Illustrate how this change affects the market for Canadian dollars by shifting one or both of the curves on the following graph. Note: Select and drag one or both of the curves to the desired position. Curves will snap Into position, so if you try to move a curve and it snaps back to its original position, just drag it a little farther. Supply X Demand CANADIAN DOLLARS U.S. DOLLARS PER CANADIAN DOLLAR Demand Supply (?) This change in the market for Canadian dollars causes the U.S. dollar to disadvantage of this change in the demand for foreign currency for the United States? O U.S. inflation is lower due to lower prices on Canadian goods. O U.S. firms find it more difficult to compete with lower-priced Canadian goods. OU.S.…change rate $1.75 1.50 1.25 1.00 200 500 S d 700 900 950 1,000 S D₂ Quantity of euros traded (millions per day) 17) Refer to Figure 30-8. The equilibrium exchange rate is at A $1.25/euro. Suppose the European Central Bank pegs its currency at $1.00/euro. At the pegged exchange rate A) there is a shortage of euros equal to 200 million. B) there is a surplus of euros equal to 700 million. Othere is a shortage of euros equal to 500 million. D) there is a surplus of euros equal to 300 million.Consider the exchange rate between the Saudi riyal and the euro. Suppose the Saudi government and the Eurozone governments agree to fix the exchange rate at 1 riyal per euro, as shown by the grey line on the following graph. Refer to the following graph when answering the questions that follow. EXCHANGE RATE (Riyal per euro) 4.0 3.5 3.0 1.5 1.0 0.5 0 0 4 Supply of Euros Demand for Euros 8 12 16 20 QUANTITY OF EUROS (Billions) 24 28 32 At the official riyal price of euros, there is a At the official exchange rate of 1 riyal per euro, the euro is pay and the Saudi riyal is ▼ for European exports than they would with a free-floating exchange rate. of euros in the foreign exchange market. , which means that Saudis Suppose the governments in the Eurozone and Saudi Arabia agree to change the official exchange rate from 1 riyal per euro to 2 riyal per euro. The action represents a of the euro and a of the riyal.
- Suppose that the euro is trading at $1.10 per euro in the foreign exchange market. Next, suppose that the exchange rate falls to $0.73 per euro, due to falling Interest rates In the eurozone. The followIng graph shows the supply and demand curves for dollars In the forelgn exchange market. On the following grah, shift ether the supply curve for dollars or the demand curve for dollars to reflect the tnfluence of "carry trade" (In isolation from other factors that may affect the exchange rate) on the exchange rate for dollars. (Hint: Carefully consider whtch price is measured on the vertical axts and which currency Is being measared on the hortzontal axis.) O dalas Dalas QUANTITY (dolars) PRICE OF DOLLARS (euros per dollar)Paragraph H H Euros per Dollar Quantity of Dollars Styles 1 Title 1. Headline: Fed raises interest rates; attracts foreign investors. Supply of dollars (increase / decrease / stay the same) Demand for dollars (increase / decrease / stay the same) Euros per Dollar (increase / decrease / stay the same) Quantity of Dollars (increase / decrease / stay the same) Select- Editing Create PDF C and Share link Sh A Consider the foreign exchange market for dollars as discussed in Chapter 14, section 3.2 of your text and depicted above. How would the news headlines below affect the market for foreign exchange? Highlight or change the color of your response. 2 Display SettingsThe graph shows the supply curve of Canadian dollars. Draw a new supply curve that shows the effect of a rise in the expected future exchange rate. Label it. A change in the expected future exchange rate changes the supply of Canadian dollars________, and a change in Canadian demand for imports changes the supply of Canadian dollars O A. today; today B. in the future; today C. today; in the future D. in the future; in the future 120 MacBook Pro 110 100- 90- 80- 70- Exchange rate (Canadian cents per Canadian dollar) Click the graph, choose a tool in the palette and follow the instructions to create your graph. So 70 80 90 100 10 20 30 40 50 60 Quantity (billions of Canadian dollars per day) >>> Draw only the objects specified in the question.
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