When does the degree of international capital mobility affect the qualitative change in the exchange rate (assume flexible exchange rates)?
a. The degree of international capital mobility is important when analyzing changes in monetary policy.
b. The degree of international capital mobility is important when analyzing changes in fiscal policy.
c. The degree of international capital mobility never affects the qualitative change in the exchange rate.
d. The degree of international capital mobility affects the qualitative change in the exchange rate when analyzing changes in the monetary policy as well as changes in the fiscal policy.
Question 2 - Which of the following is not a function of money?
a. Medium of exchange.
b. Standard of deferred payment.
c. Unit of account.
d. Store of value.
e. All of the above are functions of money.
Question 3 - The degree of international capital mobility is affected by:
a. The value of the domestic currency.
b. Central bank capital controls.
c. The monetary base.
d. The money supply.
e. The quantity of domestic currency traded per time period.
Question 4 - The unit of account function of money means it is the:
a. Asset people can use to accumulate wealth.
b. Unit in terms of which everything is valued and the basis for establishing relative prices between goods and services.
c. Barter value of a product for which a nation has a comparative advantage.
d. Unit in terms of which people write contracts.
e. Asset individuals get for goods and services and then use later to purchase other goods and services.
Question 5 - High-mobility international capital markets exist when:
a. Changes in any of the three key macroeconomic markets affect the other two markets weakly.
b. Changes in any of the three key macroeconomic markets affect the other two markets strongly.
c. Current international transactions effects outweigh net nonreserve-related international borrowing/lending effects.
d. Net nonreserve-related international borrowing/lending effects outweigh current international transactions effects.
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