771. By controlling the monetary base economists mean ?
A. making banks keep a certain % of their assets as M0
B. controlling the money multiplier
C. restricting the amount of cash in circulation
D. not allowing commercial banks to issue notes and coins

772. Fiscal drag occurs when ?
A. Tax bands do not increase with inflation
B. Tax rates move inversely with inflation
C. Government spending falls to reduce aggregate demand
D. Tax banks increase with inflation

773. If the exchange rate is 11 Mexican pesos per U.S dollar, then it takes _______ to buy 1 peso?
A. $0.0909
B. $0.1002
C. $0.2826
D. $1.1024

774. Currency speculation is _____ if speculators bet against market forces that cause exchange fluctuations, thus moderating such fluctuations ?
A. destabilizing
B. stabilizing
C. inflationary
D. deflationary

775. A difference between forward and futures contracts is that ?
A. forward contracts occur in a specific locations-for example, the Chicago Mercantile Exchange
B. futures contracts have negotiable delivery dates
C. forward contracts can be tailored in amount and delivery date to the need of importers of exporters
D. futures contracts involve no brokerage fees or other transactions costs

776. The price of one country’s currency in terms of another country’s currency is the ?
A. exchange rate
B. balance of trade
C. terms of trade
D. currency valuation

777. The agreements that were reached at the Bretton Woods conferences in 1944 established a system ?
A. of essentially fixed exchange rates under which each country agreed to intervene in the foreign exchange market when necessary to maintain the agreed upon value of its currency
B. in which the value of currencies was fixed in terms of a specific number of ounces of gold, which in turn determined their values in international trading
C. of floating exchange rates determined of the supply and demand of one nation’s currency relative to the currency of other nations
D. That prohibited governments from intervening in the foreign exchange markets

778. Exchange rates that are determined by the unregulated forces of supply and demand are ?
A. floating exchange rates
B. pegged exchange rates
C. managed exchange rates
D. fixed exchange rates

779. A fiscal expansion in the UK ?
A. has no predictable effect on the price of the pound sterling?
B. does not affect the price of the pound sterling
C. tends to appreciate the pound sterling
D. tends to depreciate the pound sterling

780. The rise in value of one currency relative to another is ?
A. a weakening of a currency
B. A depreciation of a currency
C. An appreciation of a currency
D. a debasement of a currency


This Post Has One Comment

Leave a Reply