Under a system of floating exchange rates there is a general tendency for ?
The rise in value of one currency relative to another is ?
A fiscal expansion in the UK ?
Exchange rates that are determined by the unregulated forces of supply and demand are ?
The agreements that were reached at the Bretton Woods conferences in 1944 established a system ?
The price of one country’s currency in terms of another country’s currency is the ?
A difference between forward and futures contracts is that ?
Currency speculation is _____ if speculators bet against market forces that cause exchange fluctuations, thus moderating such fluctuations ?
If the exchange rate is 11 Mexican pesos per U.S dollar, then it takes _______ to buy 1 peso?
Suppose that Boeing is to receive payment in euros in 6 month and wants to engage in hedging the firm would _______ euros on the 6-month forward market in order to protect itself from a/an of the euro?
The essential feature of a _______ is that it immediately fixed the rate at which a specified amount of one currency is to be delivered in exchange for a specific amount of another at a future date ?
The difference between bid (buying) rates and ask (selling) rates is called the ?
The least common type of transaction in the foreign exchange is a ?
The reduction or covering of foreign exchange risk is called ?
Suppose there occurs an increase in the Canadian demand for Japanese computers This results in a (an) ?
Given the foreign currency market for the Swiss franc, the supply of franc slopes upward, because as the dollar price of the franc rises ?
Which financial instrument provides a buyer the right to purchase or sell a fixed amount of currency at a prearranged price, within a few days to a couple of years ?
A depreciation of the dollar will have its most pronounced impact on imports if the demand for imports is ?
In the early eighties, the Federal Reserve pursed a tight monetary policy. All else being equal. the impact of that policy was to interest rates in the United States relative to those in Europe and cause the dollar to _______ against European currencies?
The supply of foreign currency tends to be ?
The J-curve effect refers to the observation that ?
If a nation’s interest rates are relatively low compared to those of other countries then the exchange value of its currency will tend to ?
The theory of international exchange that holds that exchange rates adjust to offset differences in countries inflation rates in the ?
The fall in value of one currency relative to another is ?
If the Bank of England reduces the money supply to reduce inflation a floating exchange rate will aid the Bank of England in fighting inflation because ?
In 1971, most countries ?
All currencies other than the domestic currency of a given country are referred to as ?
Speculators in foreign exchange markets do all of the following except ?
The real effective exchange rate for the U.S dollar ?
Investor engage in _____ when they move funds into foreign currencies in order to take advantage to interest rates abroad that are higher than domestic interest rates ?
Which of the following is not a reason why Joe Smith (an American) might participate as a demander in the foreign exchange market ?
If Sweden’s currency depreciates relative to Norway’s currency ?
The franc is said to be selling at a _______ if the spot dollar price is $0.48 and the nine-month forward rate is $0.42 ?
Riskless transactions to take advantage of profit opportunities due to a price differential or a yield differential in excess of transaction costs are called ?
If the bank is selling francs for $0.45, then what is the implied franc price of the dollar ?
An important feature of a _______ is that the holder has the right but not the obligation to buy or sell currency ?
The exchange rate is kept the same across geographically separate markets by ?
In a supply and demand diagram for Japanese yen, with the exchange rate in dollars per yen on the vertical axis, the demand schedule for yen is drawn sloping ?
The largest volume of foreign exchange trading takes place in ?
During the era of dollar appreciation from 1981 to 1985 a main reason why the dollar did not fall in value was ?
Under a system of floating exchange rates the pound would depreciate in value if there occurs ?
Suppose that a Swiss television set that costs 400 francs in Switzerland cost $200 in the United States. The exchange rate between the franc and the dollar is ?
1. The most widely traded currency in the foreign exchange market is the ?

Expansionary monetary policy ?

A. tends to lead to an appreciation of a nation’s currency
B. tends to lead to a depreciation of a nation’s currency
C. usually has no effect on a currency’s exchange value
D. tends to lead to a depreciation of the currencies of other nations

Correct Answer: B. tends to lead to a depreciation of a nation’s currency ✔

Last Updated: June 11, 2019