Question :
21) An expansionary monetary policy in the United States should
A) : 1267011
21) An expansionary monetary policy in the United States should
A) decrease the foreign currency price of U.S. exports.
B) cause the dollar to appreciate.
C) decrease the dollar price of imports.
D) decrease net exports.
22) How will an interest rate decrease in the United States affect equilibrium in the foreign exchange market?
A) The equilibrium exchange rate will increase, and the equilibrium quantity of dollars traded cannot be determined.
B) The equilibrium exchange rate will decrease, and the equilibrium quantity of dollars traded cannot be determined.
C) The equilibrium exchange rate cannot be determined, and the equilibrium quantity of dollars traded will increase.
D) The equilibrium exchange rate will increase, and the equilibrium quantity of dollars traded will increase.
23) How will contractionary monetary policy in Japan affect the demand and supply of the yen in the foreign exchange market?
A) The demand for the yen will fall, and the supply of the yen will increase.
B) The demand for the yen will increase, and the supply of the yen will fall.
C) The demand for the yen will fall, and the supply of the yen will fall.
D) The demand for the yen will increase, and the supply of the yen will increase.
24) Which of the following will not shift the demand for the euro to the right?
A) an increase in interest rates in the European Union
B) an increase in incomes in countries that buy goods from the European Union
C) expectations among speculators that the price of the euro will rise in the future
D) a decrease in the demand for European goods
25) When Americans increase their demand for Japanese goods,
A) the demand for dollars will rise, and the demand for yen will rise.
B) the demand for dollars will fall, and the demand for yen will rise.
C) the supply of dollars will rise, and the demand for yen will rise.
D) the supply of dollars will fall, and the demand for yen will fall.
26) If the dollar appreciates, how will aggregate demand in the United States be affected?
A) Aggregate demand will shift to the right as exports increase.
B) Aggregate demand will shift to the right as imports increase.
C) Aggregate demand will shift to the left as imports increase.
D) Aggregate demand will shift to the left as exports increase.
27) What effect does a depreciation of the dollar have on real GDP in the United States in the short run?
A) Real GDP will fall.
B) Real GDP will rise.
C) Real GDP will be unaffected by the depreciation of the dollar.
D) Real GDP will be unchanged, but nominal GDP will rise.
28) The recession of 2007-2009 decreased the demand for imports in Japan, which caused the ________ curve for the yen to ________, increasing the exchange rate and the value of the yen.
A) supply; right
B) supply; left
C) demand; right
D) demand; left
29) An appreciating yen makes Japanese products
A) more expensive in foreign markets.
B) less expensive in foreign markets.
C) more expensive in the Japanese market.
D) more expensive in both foreign markets and the Japanese market.
30) If a country has a fixed exchange rate,
A) the equilibrium exchange rate in that market does not respond to changes in supply and demand for currency.
B) central banks have more control over real GDP in the economy.
C) central banks must buy and sell their holdings of currencies to maintain a given exchange rate.
D) the exchange rate is allowed to fluctuate in response to changes in the supply and demand for currency.
