Suppose we were analyzing the Turkish lira per euro foreign exchange market. If there is the expectation that the euro will fall in value in the near future. As a result of speculators' actions the:spot
a. Supply of euros in the foreign exchange market falls, and the demand for euros in the foreign exchange market rises, causing an appreciation of the euro.
b. Supply of euros in the foreign exchange market rises, and the demand for euros in the foreign exchange market falls, causing an appreciation of the euro.
c. Supply of euros in the foreign exchange market rises, and the demand for euros in the foreign exchange market rises, causing an uncertain change in the value of the euro.
d. Supply of euros in the foreign exchange market rises, and the demand for euros in the foreign exchange market falls, causing a depreciation of the euro.
e. Neither supply nor demand in the foreign exchange market change because relative international prices influence trade flows and not the exchange rate.
Question 2 - Suppose we were analyzing the Turkish lira per euro foreign exchange market. If there is the expectation that the euro will fall in value in the near future. As a result of speculators' actions the:spot
a. Supply of euros in the foreign exchange market falls, and the demand for euros in the foreign exchange market falls, causing an uncertain change in the value of the euro.
b. Supply of euros in the foreign exchange market rises, and the demand for euros in the foreign exchange market falls, causing an appreciation of the euro.
c. Supply of euros in the foreign exchange market rises, and the demand for euros in the foreign exchange market rises, causing an uncertain change in the value of the euro.
d. Supply of euros in the foreign exchange market rises, and the demand for euros in the foreign exchange market falls, causing a depreciation of the euro.
e. Supply of euros in the foreign exchange market falls, and the demand for euros in the foreign exchange market rises, causing an appreciation of the euro.
Question 3 - Suppose we were analyzing the Turkish lira per euro foreign exchange market. If there is the expectation that the euro will fall in value in the near future. As a result of speculators' actions the:spot
a. Supply of euros in the foreign exchange market rises, and the demand for euros in the foreign exchange market falls, causing a depreciation of the euro.
b. Supply of euros in the foreign exchange market falls, and the demand for euros in the foreign exchange market falls, causing an uncertain change in the value of the euro.
c. Supply of euros in the foreign exchange market falls, and the demand for euros in the foreign exchange market rises, causing an appreciation of the euro.
d. Neither supply nor demand in the foreign exchange market change because relative international prices influence trade flows and not the exchange rate.
e. Supply of euros in the foreign exchange market rises, and the demand for euros in the foreign exchange market rises, causing an uncertain change in the value of the euro.
Question 4 - Suppose we were analyzing the Turkish lira per euro foreign exchange market. If there is the expectation that the euro will fall in value in the near future. As a result of speculators' actions the:spot
a. Supply of euros in the foreign exchange market rises, and the demand for euros in the foreign exchange market falls, causing an appreciation of the euro.
b. Supply of euros in the foreign exchange market rises, and the demand for euros in the foreign exchange market rises, causing an uncertain change in the value of the euro.
c. Supply of euros in the foreign exchange market rises, and the demand for euros in the foreign exchange market falls, causing a depreciation of the euro.
d. Supply of euros in the foreign exchange market falls, and the demand for euros in the foreign exchange market rises, causing an appreciation of the euro.
e. Neither supply nor demand in the foreign exchange market change because relative international prices influence trade flows and not the exchange rate.
Question 5 - By how much does the real, bilateral exchange rate change when the nominal, bilateral exchange rate changes from 1.10/ to 1.00/, the U.S. tradable basket from 500 to 600 and the Euro-Area tradable basket from 550 to 580?
a. The real exchange rate rises approximately by 18.
b. The real exchange rate falls approximately by 3
c. The real exchange rate rises approximately by 3
d. The real exchange rate falls approximately by 20
e. The real exchange rate falls approximately by 18
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