Foreign exchange markets – Essaylink
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Free InquiryA. I f the value of a nation’s imports exceeds the value of its exports, which of the following is NOT true?
a. Net exports are negative.
b. GDP is less than the sum of consumption, investment, and government purchases.
c. Domestic investment is greater than national saving.
d. The nation is experiencing a net outflow of capital.
B. I f a nation’s currency doubles in value on foreign exchange markets, the currency is said to
_________, reflecting a change in the _________ exchange rate.
a. appreciate; nominal
b. appreciate; real
c. depreciate; nominal
d. depreciate; real
C. I f 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; deficitc. less; surplus
d. less; deficit
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