Principles of Macroeconomics 2e
2nd Edition
ISBN: 9781947172388
Author: Steven A. Greenlaw; David Shapiro
Publisher: OpenStax
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Textbook Question
Chapter 16, Problem 11RQ
Describe some buyers and some sellers in the market for U.S. dollars.
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Chapter 16 Solutions
Principles of Macroeconomics 2e
Ch. 16 - How will a stronger euro affect the following...Ch. 16 - Suppose that political unrest in Egypt leads...Ch. 16 - Suppose U.S. interest rates decline compared to...Ch. 16 - Suppose Argentina gets inflation under control and...Ch. 16 - This chapter has explained that one of the most...Ch. 16 - A booming economy can attract financial capital...Ch. 16 - How would a contractionary monetary policy affect...Ch. 16 - A central bank can allow its currency to fall...Ch. 16 - Is a country for which imports and exports...Ch. 16 - What is the foreign exchange market?
Ch. 16 - Describe some buyers and some sellers in the...Ch. 16 - What is the difference between foreign direct...Ch. 16 - What does it mean to hedge a financial...Ch. 16 - What does it mean to say that a currency...Ch. 16 - Does an expectation of a stronger exchange rate in...Ch. 16 - Does a higher rate of return in a nations economy,...Ch. 16 - Does a higher inflation rate in an economy, other...Ch. 16 - What is the purchasing power parity exchange rate?Ch. 16 - What are some of the reasons a central bank is...Ch. 16 - How can an unexpected fall in exchange rates...Ch. 16 - What is the difference between a floating exchange...Ch. 16 - List some advantages and disadvantages of the...Ch. 16 - Why would a nation dollarize—that is, adopt...Ch. 16 - Can you think of any major disadvantages to...Ch. 16 - If a countrys currency is expected to appreciate...Ch. 16 - Do you think that a country experiencing...Ch. 16 - Suppose a country has an overall balance of trade...Ch. 16 - We learned that changes in exchange rates and the...Ch. 16 - If a developing country needs foreign capital...Ch. 16 - Many developing countries, like Mexico, have...Ch. 16 - What would make a country decide to change from a...Ch. 16 - A British pound cost 2.00 in U.S. dollars in 2008,...
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Similar questions
- If the price of one gallon of gasoline goes down from $4.07 per gallon to $3.99 per gallon, how will that affect the value of the US dollar? Why does it affect the value of the dollar?arrow_forwardWhen a country's currency appreciates, is this generally good news or bad news for a country's consumers? Is it generally good or bad news for the country's businesses? Explain your reasoning - try to use examples.arrow_forwardIf a strike takes place in France, making it harder to buyFrench goods, what will happen to the value of the U.S.dollar?arrow_forward
- Exchanging dollars for euros to pay a computer manufacturer in Belgium would occur at the European Central Bank. at the Federal Reserve. in the letter of credit market. in the foreign exchange market.arrow_forwardThe difference between the amount we spend to import products from other countries and the amount we make when we export products to other countries is called the balance of trade. Why would the balance of trade affect the value of the US dollar? Is it better to import more or to export more? Why?arrow_forwardState reasons why countries renominate their currencyarrow_forward
- Differentiate between foreign exchange and the foreign exchange rate.arrow_forwardGM produces and sells a compact car for $26,000. Volkswagen produces and sells a compact car for 19,000 euros. If the exchange rate is 1 dollar for 0.72 euros, which car would be the least expensive choice? Show your work.arrow_forwardThe popularity of the leader of a nation can affect the value of their currency. If the President of the United States has a good popularity rating with the citizens of the United States, does that make the US dollar stronger or weaker? Why or why not?arrow_forward
- To me I’m on the fence for the dollar being strong. One of the benefits of the dollar being strong means us, US citizens spend less money on imports. Goods produced in foreign countries will be imported for cheaper if the company producing the products currency falls below the dollar. If the dollar keeps strengthening and import prices keep falling US citizens will have more money to spend. Another benefit is cheaper traveling to foreign countries. You will be able to use less US dollars to get more money and goods abroad. A negative of a strong dollar is it will decrease tourism in the US since it will cost more to travel here. Another negative is the exports will become more expensive and international businesses will be hurt if they deal in foreign currencies. Being a citizen in the US it would be great to have a strong dollar, however as a company exporting or partaking in business in a foreign country could potentially harm your business. please help reply to this postarrow_forwardHow much damage can Saudi Arabia do to the United States economy if they started selling their Oil using another type of currency rather than the US dollar?arrow_forwardChanges or variations in Foreign Exchange Rates can create a lot of uncertainties for businesses. As a manager, what measures you would recommend to minimize foreign exchange risks.arrow_forward
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