MACROECONOMICS+ACHIEVE 1-TERM AC (LL)
10th Edition
ISBN: 9781319467203
Author: Mankiw
Publisher: MAC HIGHER
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Question
Chapter 6, Problem 4QQ
To determine
The effect of import restriction.
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Which of the following is not included in the current account?a. exports of goodsb. imports of goodsc. U.S. capital inflow and outflowd. unilateral transfers
If other things are held constant, an increase in Kazakhstan's export will
a. Tend to cause tenge to depreciate because the supply of tenge will
decline
b. Tend to cause tenge to depreciate because the supply of tenge will rise
C.
Have no effect on tenge value
d. Tend to cause tenge to appreciate because the demand for tenge will
rise
e. Tend to cause tenge to appreciate because the supply of tenge will rise
If the U.S. dollar appreciates and prices remain the same at home and abroad, foreign goods become _____ expensive relative to American goods, pushing the U.S. trade balance toward _____.
a)more;surplus
b)more;deficit
c)less;surplus
d)less;deficit
Chapter 6 Solutions
MACROECONOMICS+ACHIEVE 1-TERM AC (LL)
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- As domestic currency appreciates, we would expect a. Trade deficit to decrease. b. Trade deficit to increase. c. Imports to decrease. d. Exports to increase.arrow_forwardWho would benefit if the exchange rate with yen (in U.S. dollars) increased (i.e. one dollar can buy more yens)? U.S. exporters. U.S. consumers and Japanese exporters. Japanese exporters. Japanese tourists. U.S. consumers.arrow_forwardHow does an increase in domestic income affect demand for imports how does a decrease in real exchange rate affect demand for importsarrow_forward
- An external balance surplus will cause. floating exchange rate regime. in a fixed exchange rate regime and in a government intervention to raise the value of the currency; the currency to depreciate government intervention to lower the value of the currency; the currency to depreciate government intervention to raise the value of the currency; the currency to appreciate government intervention to lower the value of the currency: the currency to apprecatearrow_forwardIf there is a decrease in the desire of foreigners to purchase goods and services from the United States and a lower desire to invest in U.S. banks and businesses, then how would this affect the U.S. foreign exchange market? A. The equilibrium quantity of foreign currency would decrease and the U.S. dollar would depreciate. B. The equilibrium quantity of foreign currency would decrease and the U.S. dollar would appreciate. C. The equilibrium quantity of foreign currency would increase and the U.S. dollar would depreciate. D. The equilibrium quantity of foreign currency would increase and the U.S. dollar would appreciate.arrow_forward-When a currency depreciates .... this. ) .... It forces exporters. B. ) ... It is always terribly for the economy. C. ) ... It Receives Internal Precautions. -When a currency appreciates .... A.) ... it is always the best thing to happen to an economy. B.) ... it hinders exports. C.) ... it always means that the people of a nation are becoming richer. -Interest rates ... A.) .... do not affect the value of national currencies at all. B.) ... are a mean that governments have to control the appreciation or depreciation of a local currency C.) ... are not relevant for governmentsarrow_forward
- What effect does a depreciation of the domestic currency have on a country's export prices and competitiveness in the global market? A. It increases export prices and reduces competitiveness. B. It decreases export prices and increases competitiveness. C. It has no effect on export prices and competitiveness. D. It increases both export prices and competitiveness.arrow_forwardIncrease in foreign income will _______ net export but depreciation of domestic currency will ________ net export. Increase: Decrease Increase: Increase Decrease: Increase Decrease: Decreasearrow_forwardIf a country devalues its currency, that will immediately improve its trade deficit. T/Farrow_forward
- If a country imports more than it exports, it has a trade deficit. True or falsearrow_forwardRapid increases in the U.S. exports of goods and services will result in a(n) U.S. dollars in the foreign exchange foreign currency and a(n). market. increase in the demand for; increase in the supply of increase in the supply of; increase in the demand for shortage of foreign currency; surplus of decrease in the supply of; decrease in the demand forarrow_forwardSuppose that the exchange rate falls from 84 yen per U.S. dollar to 71 yen per U.S. dollar. What is the effect of this change on the quantity of U.S. dollars that people plan to sell in the foreign exchange market? The quantity of U.S. dollars that people plan to sell in the foreign exchange market A. decreases and the supply curve of U.S. dollars shifts leftward B. increases and the supply curve of U.S. dollars shifts rightward C. increases and a movement up along the supply curve for U.S. dollars occurs D. decreases and a movement down along the supply curve of U.S. dollars occursarrow_forward
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