Question 1

Under a system of freely flexible (floating) exchange rates an American trade deficit with Mexico will tend to cause

Accepted Answer

A)  the United States government to ration pesos to American importers.
B)  a flow of gold from the United States to Mexico.
C)  an increase in the peso price of dollars.
D)  an increase in the dollar price of pesos.E) A) and B)
F) None of the above

Question 2

In considering pounds and dollars we can say that when the dollar rate of exchange for the pound rises

Accepted Answer

A)  the pound rate of exchange for the dollar will fall.
B)  the pound rate of exchange for the dollar will also rise.
C)  the pound rate of exchange for the dollar may either fall or rise.
D)  American net exports to Britain will tend to fall.E) B) and C)
F) A) and B)

Question 3

In the year _____________________,our President announced that we would no longer redeem dollars for gold.

Accepted Answer

The answer of In the year _____________________,our President announced that...

Question 4

If the exchange rate changes so that more Swiss francs are required to buy a dollar,then

Accepted Answer

A)  the franc has appreciated in value.
B)  Americans will buy more Swiss goods and services.
C)  more American goods and services will be demanded by the Swiss.
D)  the dollar has depreciated in value.E) A) and B)
F) None of the above

Question 5

If the dollar depreciates in value against the euro for an American,the cost of French champagne

Accepted Answer

A)  rises.
B)  falls.
C)  stays the same.D) A) and B)
E) None of the above

Question 6

The amount of one currency that must be paid to obtain one unit of another currency is the _______________.

Accepted Answer

foreign ex...

Question 7

Which one of these countries has not adopted the euro?

Accepted Answer

A)  Germany
B)  France
C)  Italy
D)  EnglandE) B) and C)
F) A) and D)

Question 8

Statement I: A declining dollar makes foreign investment in dollar-denominated assets more attractive.
Statement II: In the last 20 years,foreigners have expanded their role in the U.S.as both creditors and owners.

Accepted Answer

A)  Statement I is true and statement II is false.
B)  Statement II is true and statement I is false.
C)  Both statements are true.
D)  Both statements are false.E) B) and D)
F) None of the above

Question 9

Under the gold standard,a country with a negative balance of trade would experience

Accepted Answer

A)  an inflow of gold and higher prices.
B)  an inflow of gold and lower prices.
C)  an outflow of gold and higher prices.
D)  an outflow of gold and lower prices.E) B) and C)
F) A) and D)

Question 10

If 1 U.S.dollar exchanges for 3.98 Polish zlotys,how much would it cost in zloty to purchase a Ford Explorer priced at $23,000?

Accepted Answer

23,000 x 3...

Question 11

If 1 U.S.dollar exchanges for 7.89 South African rand,how much would it cost in rand to purchase a Dell P.C.priced at $795?

Accepted Answer

795 x 7.89...

Question 12

A British importer buying American wheat would pay for his purchases in _________.

Accepted Answer

The answer of A British importer buying American wheat would...

Question 13

If a U.S.importer has to write a $200 check to cover a 20,000 yen purchase from Japan,the exchange rate is

Accepted Answer

A)  200 yen to a dollar.
B)  100 yen to a dollar.
C)  20 yen to a dollar.
D)  10 yen to a dollar.
E)  200 dollars to a yen.F) C) and E)
G) A) and C)

Question 14

The exchange rate between the U.S.dollar and the Japanese yen change

Accepted Answer

A)  every five years.
B)  on a yearly basis.
C)  on a monthly basis.
D)  at times from one minute to the next.E) All of the above
F) C) and D)

Question 15

Which statement is true?

Accepted Answer

A)  In both the 19th century and since the 1980s we borrowed from foreigners to finance both capital expansion and consumption.
B)  In neither the 19th century nor since the 1980s we borrowed from foreigners to finance both capital expansion and consumption.
C)  In the 19th century we borrowed from foreigners to finance capital expansion and since the 1980s we borrowed to finance consumption.
D)  In the 19th century,we borrowed from foreigners to finance consumption and since the 1980s we borrowed to finance capital expansion.E) A) and B)
F) B) and D)

Question 16

Statement I: Decisions affecting the U.S.economy are being made increasingly in London,Frankfurt,and Tokyo.
Statement II: America is borrowing largely for today's consumption rather than for productive investments.

Accepted Answer

A)  Statement I is true and statement II is false.
B)  Statement II is true and statement I is false.
C)  Both statements are true.
D)  Both statements are false.E) A) and B)
F) All of the above

Question 17

Foreign exchange rates are

Accepted Answer

A)  price at which purchases and sales of foreign goods take place.
B)  movement of goods and services from one country to another.
C)  the price of one currency in terms of a second currency.
D)  differences between exports and imports.E) None of the above
F) A) and B)

Question 18

Which statement is false?

Accepted Answer

A)  Trade is the largest part of our international financial transactions.
B)  Our capital account ran a surplus in 2009.
C)  We have been on an international gold standard since 1933.
D)  None of the statements is false.E) B) and C)
F) None of the above

Question 19

Foreign investment in the United States gives us

Accepted Answer

A)  greater control over our economy.
B)  less control over our economy.
C)  neither greater control nor less control over our economy.D) B) and C)
E) A) and B)

Question 20

If the dollar depreciated relative to the yen,it would be expected that

Accepted Answer

A)  the Japanese trade surplus with the U.S.would be increased (or the trade deficit would be reduced) .
B)  Japanese imports from the United States would decrease.
C)  Japanese exports to the United States would decrease.
D)  All of the choices are true.E) A) and D)
F) A) and B)

Exam 32: International Finance

If the dollar depreciates in value against the euro for an American,the cost of French champagne

Correct AnswerverifiedShow Answer

Foreign exchange rates are

Correct AnswerverifiedShow Answer

Statement I: Decisions affecting the U.S.economy are being made increasingly in London,Frankfurt,and Tokyo. Statement II: America is borrowing largely for today's consumption rather than for productive investments.

Correct AnswerverifiedShow Answer

If 1 U.S.dollar exchanges for 7.89 South African rand,how much would it cost in rand to purchase a Dell P.C.priced at $795?

Correct Answerverified795 x 7.89...View AnswerShow Answer

If the dollar depreciated relative to the yen,it would be expected that

Correct AnswerverifiedShow Answer

If 1 U.S.dollar exchanges for 3.98 Polish zlotys,how much would it cost in zloty to purchase a Ford Explorer priced at $23,000?

Correct Answerverified23,000 x 3...View AnswerShow Answer

In the year _____________________,our President announced that we would no longer redeem dollars for gold.

Correct AnswerverifiedShow Answer

The exchange rate between the U.S.dollar and the Japanese yen change

Correct AnswerverifiedShow Answer

The amount of one currency that must be paid to obtain one unit of another currency is the _______________.

Correct Answerverifiedforeign ex...View AnswerShow Answer

Which statement is false?

Correct AnswerverifiedShow Answer

If a U.S.importer has to write a $200 check to cover a 20,000 yen purchase from Japan,the exchange rate is

Correct AnswerverifiedShow Answer

Statement I: A declining dollar makes foreign investment in dollar-denominated assets more attractive. Statement II: In the last 20 years,foreigners have expanded their role in the U.S.as both creditors and owners.

Correct AnswerverifiedShow Answer

Which one of these countries has not adopted the euro?

Correct AnswerverifiedShow Answer

A British importer buying American wheat would pay for his purchases in _________.

Correct AnswerverifiedShow Answer

If the exchange rate changes so that more Swiss francs are required to buy a dollar,then

Correct AnswerverifiedShow Answer

In considering pounds and dollars we can say that when the dollar rate of exchange for the pound rises

Correct AnswerverifiedShow Answer

Under the gold standard,a country with a negative balance of trade would experience

Correct AnswerverifiedShow Answer

Which statement is true?

Correct AnswerverifiedShow Answer

Foreign investment in the United States gives us

Correct AnswerverifiedShow Answer

Under a system of freely flexible (floating) exchange rates an American trade deficit with Mexico will tend to cause

Correct AnswerverifiedShow Answer

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795 x 7.89...
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23,000 x 3...
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foreign ex...
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