A restrictive monetary policy in Canada is most likely to: Multiple Choice depreciate the international value of the dollar and decrease Canadian net exports. depreciate the international value of the dollar and increase Canadian net exports. appreciate the international value of the dollar and increase Canadian net exports. appreciate the international value of the dollar and decrease Canadian net exports.
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A restrictive
Multiple Choice
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depreciate the international value of the dollar and decrease Canadian net exports.
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depreciate the international value of the dollar and increase Canadian net exports.
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appreciate the international value of the dollar and increase Canadian net exports.
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appreciate the international value of the dollar and decrease Canadian net exports.
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- The U.S. dollar is still considered the most traded and the most stable currency in the world. It is easily converted over to other currencies when trading and is also the official currency of several U.S. territories. However, a strong U.S. dollar has both advantages and disadvantages. One of the advantages that was already mentioned is that the conversion of the U.S. dollar over to other countries is fairly easy and grants it a greater degree of buying power for foreign products. This also makes foreign imports cheaper not to mention investors benefit when engaging in FDI. The disadvantages of a strong U.S. dollar is that it makes it more expensive for foreign countries to import products from the U.S., which negatively affects industries and business owners within that country as a result. It can even negatively affect the U.S. because those that conduct business internationally will technically earn less from foreign sales if their currency is not fully convertible. Overall, even…The U.S. dollar is still considered the most traded and the most stable currency in the world. It is easily converted over to other currencies when trading and is also the official currency of several U.S. territories. However, a strong U.S. dollar has both advantages and disadvantages. One of the advantages that was already mentioned is that the conversion of the U.S. dollar over to other countries is fairly easy and grants it a greater degree of buying power for foreign products. This also makes foreign imports cheaper not to mention investors benefit when engaging in FDI. The disadvantages of a strong U.S. dollar is that it makes it more expensive for foreign countries to import products from the U.S., which negatively affects industries and business owners within that country as a result. It can even negatively affect the U.S. because those that conduct business internationally will technically earn less from foreign sales if their currency is not fully convertible. Overall, even…The U.S. economy is faltering, so the value of its associated currency, the dollar, is likely to
- Select all statements from below that accurately describe shifts in the supply or demand of the Australian dollar (AUD): Group of answer choices American consumers increase their demand for stainless steel appliances, resulting in greater Australian exports of iron ore. This causes the demand curve for the AUD to shift to the right. Australian restauranteurs increase their imports of spices from India, shifting the supply curve of the AUD to the right. Temperatures in Japan rise, leading to a decrease in Australian wool exports to that nation. This causes the supply curve of the AUD to shift left. Senegal opens its markets to import Australian goat/sheep meat. This causes the demand curve of the AUD to shift left. Mongolian manufacturers switch their primary supplier of aluminum oxide from China to Russia, causing the supply curve of the AUD to decrease.Depreciation of the dollar will: decrease the prices of both U.S. imports and exports increase the prices of both U.S. imports and exports decrease the prices of U.S. imports, but increase the prices to foreigners of U.S. exports increase the prices of U.S. imports, but decrease the prices to foreigners of U.S. exportsSuppose Angola is experiencing an episode of hyperinflation. The currency in Angola is the second kwanza (which is actually the fourth currency called kwanza that has circulated since 1977). The currency code is (AOA). Select all choices below that are implied by the statement if parity conditions (PPP, IRP, FEP) hold: Nominal interest rates in Angola will exceed nominal interest rates in countries not experiencing hyperinflation. The value of the AOA is expected to drop to zero. Real interest rates in Angola will fall relative to countries without hyperinflation. The AOA is expected to depreciate against any currencies that are not experiencing hyperinflation.
- Which of the following is most likely to cause a leftward shift of the demand curve for the Chinese yuan in exchange for the U.S. dollar? An increase in the demand for U.S. products in China A decrease in the demand for Chinese products in the United States An increase in the demand for Chinese products in the United States A decrease in the demand for U.S. products in ChinaIf a small country, such as Argentina, attempts to fix its currency exchange rate with the United States, its inflation rate must be higher than the U.S. inflation rate. its interest rates will move together with the U.S. interest rates. its currency value relative to the U.S. dollar will fluctuate over time. its central bank will have full flexibility in monetary policy actions. it must restrict the flow of funds with the United States.Towards the end of 2009 the pound fell to a six month low of 1.0628 Euros. Figures released by the UK government suggested that demand was still low in the country. The pound was also under downward pressure because of the low value of the interest rate. A recent report suggested these would remain at their historic low of 0.5% until 2014. Business confidence in general remained frail and there was concern over when the UK economy would start to recover from its negative growth. There was huge excess capacity in the UK. In addition the government had a huge deficit which was expected to cause problems with cutbacks and tax increases in the future. Questions Explain what determines the value of a currency. Analyze why the pound might have fallen so low towards the end of 2009. Analyze the possible effects on the UK economy of a fall in the value of the currency.
- Towards the end of 2009 the pound fell to a six month low of 1.0628 Euros. Figures released by the UK government suggested that demand was still low in the country. The pound was also under downward pressure because of the low value of the interest rate. A recent report suggested these would remain at their historic low of 0.5% until 2014. Business confidence in general remained frail and there was concern over when the UK economy would start to recover from its negative growth. There was huge excess capacity in the UK. In addition the government had a huge deficit which was expected to cause problems with cutbacks and tax increases in the future. Question: Analyze why the pound might have fallen so low towards the end of 2009.For many years, the Chinese currency has been pegged to the U.S. dollar. Critics argue that this policy has resulted in an unfair advantage for Chinese manufacturers exporting product to the U.S., and has contributed to ballooning U.S. trade deficits. Pressure to revalue, including threats of trade sanctions against China, has led the Chinese government to adopt a slightly more flexible policy which pegs the Yuan to a basket of currencies rather than the dollar alone. Some in the U.S. continue to argue that this is not sufficient, and continue to exert pressure toward a policy of further revaluation. Chinese leaders feel that increasing the value of the yuan relative to the dollar would contribute to economic and political instability in China. Details: Pressures for Change China fixed the value of its currency in 1994 to the US currency Due to arguments that the yuan was undervalued and that the Chinese government needed to free the currency, the U.S. administration announced…What are the four determinants of the demand of the Canadian dollar?