In the open-economy macroeconomic model, if a country's supply of loanable funds shifts right, then O A. net capital outflow rises, so the real exchange rate rises. O B. net capital outflow falls, so the real exchange rate rises. O C. net capital outflow rises, so the real exchange rate falls. O D. net capital outflow falls, so the real exchange rate falls.
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- On the foreign exchange market, an increase in a country's exchange rate O a. decreases the demand for its currency and shifts the demand curve leftward. O b. decreases the quantity demanded of its currency and leads to a movement up along the demand curve. decreases the demand for its currency and shifts the demand curve rightward. O d. increases the quantity demanded of its currency and leads to a movement down along the demand curve. O . increases the quantity demanded of its currency and leads to a movement up along the demand curve.How will an increase in remittance flows to your country during the Christmas Season affect the market for foreign exchange? Select one: O a. Outward shift of the demand curve, real exchange rate rises and the balance of trade rises O b. Outward shift of the supply curve, real exchange rate falls and the balance of trade falls O c. Inward shift of the supply curve, real exchange rate rises and the balance of trade rises O d. Inward shift of the demand curve, real exchange rate falls and the balance of trade falls е. Inward shift of the demand curve, real exchange rate rises and the balance of trade fallsWhich of the following statements is true of a flexible exchange rate system? O A. Market forces tend to undervalue a currency over time. O B. Market forces tend to push the exchange rate of a currency to market clearing levels over time. Market forces do not affect exchange rates between different currencies. O C. O D. Market forces tend to overvalue a currency over time. If the ratio of the dollar price of a U.S. toy to the dollar price of the same toy sold in China is greater than one, retailers in the United States should O A. should not buy the toys from both Chinese suppliers and U.S. suppliers O B. buy the toys from Chinese suppliers O C. buy the toys from both Chinese suppliers and U.S. suppliers O D. buy the toys from American suppliers Which of the following is likely to be true of the nominal and the real exchange rates in the short run and in the long run if prices in two countries do not respond to exchange rate changes? O A. The real and the nominal exchange rates between…
- How does the appreciation of a currency affect the balance of payments? a. Appreciation of a currency decreases current accounts as exports fall and imports rise O b. Appreciation of a currency decreases current accounts as both exports and imports fall O c. Appreciation of a currency increases current accounts as both exports and imports rise O d. Appreciation of a currency increases current accounts as exports fall and imports rise All of the following fall under the Philippines' capital account except for a. OFW remittances O b. Cash aid from the US for families affected by typhoon Odette O c. Stocks O d. All of the aboveHow will an increase in foreign direct investment in the hotel industry affect the market for foreign exchange? Select one: O a. Outward shift of the demand curve; real exchange rate rises. O b. Inward shift of the demand curve; real exchange rate falls. c. Inward shift of the supply curve; real exchange rate rises. O d. Inward shift of the demand curve; real exchange rate rises O e. Outward shift of the supply curve; real exchange rate falls.How will an increase in tourist arrivals affect the market for foreign exchange? Select one: O a. Inward shift of the demand curve; real exchange rate falls. O b. Outward shift of the supply curve, real exchange rate falls O . Inward shift of the demand curve; real exchange rate rises O d. Outward shift of the demand curve; real exchange rate rises. O e. Inward shift of the supply curve; real exchange rate rises.
- Time let How will an increase In tourist arrivals affect the market for forelgn exchange? Select one: O a. Inward shift of the supply curve; real exchange rate rises. O b. Inward shift of the demand curve; real exchange rate falls. O c. Outward shift of the supply curve, real exchange rate falls O d. Inward shift of the demand curve; real exchange rate rises e. Outward shift of the demand curve; real exchange rate rises. NexUnder a fixed exchange rate system (A). would be an exogenous monetary policy instrument, whereas under a flexible exchange rate system (B) endogenous monetary policy instrument. would be an O a. (A) the interest rate; (B) the exchange rate O b. (A) the exchange rate; (B) the interest rate O c. (A) the interest rate; (B) the interest rate O d. (A) the exchange rate; (B) the exchange rateHow will an increase in tourist arrivals affect the market for foreign exchange? Select one: Inward shift of the demand curve; real exchange rate rises O a. Ob. Outward shift of the demand curve; real exchange rate rises. Oc Inward shift of the supply curve; real exchange rate rises. Od. Outward shift of the supply curve, real exchange rate falls O e. Inward shift of the demand curve; real exchange rate falls.
- How will an increase in remittance flows to your country during the Christmas Season affect the market for foreign exchange? Select one: O a. Inward shift of the demand curve, real exchange rate falls and the balance of trade falls Ob. Outward shift of the demand curve, real exchange rate rises and the balance of trade rises Inward shift of the demand curve, real exchange rate rises and the balance of trade falls Inward shift of the supply curve, real exchange rate rises and the balance of trade rises Outward shift of the supply curve, real exchange rate falls and the balance of trade falls pe here to search. laThe level of exchange rate can only be determined by market forces or the supply and demand of currencies. O a. True O b. FalseAccording to the monetary model of exchange rate, if real income increases, then the price level will and the value of the currency will O increase; decrease O increase; increase O decrease; decrease O decrease; increase