A. not be affected
B. appreciate
C. depreciate
D. fluctuate more than if interest rates were high
Correct Answer: depreciate ✔
Last Updated: June 18, 2019
Related MCQs
- All of the following are benefits of the single market except ?
- In the ERM, each country fixed participant Collectively the group ________ against the rest of the world?
- If one country, with floating exchange rates, has higher inflation than its competitors we would expect its exchange rate to ?
- Under floating exchange rates, expectations of higher interest rates are likely to cause an ____ of the exchange rate?
- A fixed exchange rate, plus perfect capital mobility ________ the scope for monetary policy ?
- With fixed exchange rates and no private currency flows, when the central bank buys domestic currency the domestic money supply is ?
- perfect international capital mobility suggests that international funds will be responsive to ________ differentials?
- A rise in the real exchange rate will ________ the competitiveness of the domestic economy?
- A current account deficit means that a country may ?
- If British residents want more French francs to purchase more French cloths other things equal, then the equilibrium value of the pound against the French franc will ?
- If the economy is in the recessionary phase of the business cycle, aggregate demand unemployment ___ inflation ___ and the current account of the balance of payments is likely to move towards ____?
- If the economy is in the expansionary phase of the business cycle, aggregate demand unemployment __ inflation ____ payments is likely to move towards ____?
- If the US economy is forecast to come out of recession because military expenditure has increase then the exchange value of the UK pound will tend to ?
- If currency dealers expect the value of the pound to fall, the exchange value will tend to ?
- If the Pakistan receives larger than expected revenues from exports then the exchange value of its currency will tend to ?
- The price of one country’s currency in terms of another country’s currency is the ?
- The record of country’s transfers of land inter-government payments and money sent by migrants to and from abroad is called its ?
- The record of a country’s imports and exports of of goods and services plus net investment incomes and current transfers of money to and from abroad, is called its ?
- The record of country’s imports and exports of goods is called its ?
- If VAT rates rise, then costs are likely to ___ and demand is likely to ____?
- Government policies that focus on changing interest rates are called ?
- Government policies that focus on increasing production rather than demand are called ?
- As prices rise. People will want to keep more money as cash and in bank accounts This is called ?
- The demand for ice-cream is lower outside of summer causing lower demand for ice-cream salesman if they cannot find other work, this is called _______ unemployment?
- Unemployment resulting from imperfect information in the labour market is called ____ unemployment?
- Aggregate supply is the total amount ?
- Cyclical unemployment is the ?
- An individual who is not working and who has given up looking for work is classfied as ?
- The labour force can be defined as ?
- Reducing inflation is a more important objective than economic growth is an example of ?
- Which of the following is a possible government objective as opposed to a policy ?
- Which of the following can the government not use directly to control the economy ?
- Which does the government not control directly ?
- What is meant by an objective ?
- In the EMU a country’s competitiveness can change because of ?
- The Maastricht criteria for entry to the EMU are that applicants should have ?
- A monetary union means , __ and ________?
- The single European Act committed __ governments to a ________ in 1992?
- The main features of the European Monetary system are ?
- Fiscal policy is weak under floating exchanges rates as fiscal expansion ?
- Floating exchange rates are ____ in the short run?
- In the short run the level of floating exchange rates is determined mainly by ?
- The competitive advantage from a devaluation is likely to be offset by __ and ________?
- In the absence of international capital controls, central banks set ________ to provide the correct incentive for speculators?
- Which fixed exchange rates and no private capital flows, to correct a balance of payments deficit, the central bank will __ and ________ ?
- When capital mobility is perfect interest rate differentials will tend to be offset by ?
- Within the circular flow of income, an increase in domestic income will tend to increase ?
- Starting from a position of internal and external balance a reduction in aggregate demand will cause a current account ?
- In a fixed exchange rate regime, the central the exchange rate ?
- When the $/£ exchange rate rises the pound __ and when the $/£ rates falls the pound ________?
- If the economy is in the though phase of the business cycle, aggregate demand unemployment inflation __ and the current account of the balance of payments is likely to move towards ________?