Appreciation of the dollar means that now it takes more dollars to buy one unit of foreign currency. ...

Appreciation of the dollar means that now it takes more dollars to buy one unit of foreign currency.
 a. True
  b. False
  Indicate whether the statement is true or false

Question 2

Which of the following is true?
 a. When foreigners supply more funds than they demand, there is a capital inflow.
 b. When foreigners demand more funds than they demand, there is a capital outflow.
 c. Capital flows will tend to move real interest rates in different countries closer to one another.
  d. All of the above are true.

Question 3

High rates of unemployment are undesirable because:
 a. they cause increased levels of societal tension.
 b. society loses potential production of goods and services.
  c. families of the unemployed may find it difficult to survive.
  d. all of the above.

Question 4

The exchange rate affects the trade in goods and services between California and NewYork.
 a. True
  b. False
  Indicate whether the statement is true or false

Question 5

If the dollar price of euros is lower than the equilibrium price, there will be an excess quantity of euros ____ at that price, and competition among euro ____ will push the price of Euros toward equilibrium.
 a. supplied, sellers.
 b. supplied; buyers.
 c. demanded; sellers.
  d. demanded; buyers.

Question 6

The first formal acknowledgement of the primary macroeconomic goals of price stability, high employment, and promoting economic growth in the United States came with passage of the:
 a. Federal Reserve Act of 1913.
 b. the Sherman Antitrust Act of 1890.
  c. the Social Security Act of 1935.
 d. the Employment Act of 1946.

Question 7

Fixed exchange rates allow countries to formulate their economic policies independently of other nations.
 a. True
  b. False
  Indicate whether the statement is true or false

Question 8

An appreciation of the exchange value of the U.S. dollar would:
 a. increase the dollar prices of U.S. imports and the foreign cost of exports from the U.S.
 b. decrease the dollar prices of U.S. imports and the foreign cost of exports from the U.S.
 c. increase the dollar prices of U.S. imports, but decrease the foreign cost of exports from the U.S.
  d. decrease the dollar prices of U.S. imports, but increase the foreign cost of exports from the U.S.

Question 9

Which piece of legislation committed the government to pursuing unemployment policies that are consistent with maintaining price stability?
 a. The Effective Pricing Act of 1971
 b. The Employment Initiative Act of 1998
  c. The Employment Act of 1946
 d. The Stable Growth Act of 1960

Question 10

Under a floating exchange-rate system, a country needs to pay more attention to the economic policies of the rest of the world.
 a. True
  b. False
  Indicate whether the statement is true or false

Question 11

A change in the euro-dollar exchange rate from 1 per euro to 2 per euro would ____ the U.S. price of German goods, ____ the number of German goods that would be demanded in the U.S.
 a. decrease; reducing.
 b. decrease; increasing.
  c. increase; reducing.
 d. increase; increasing.

Question 12

Real gross domestic product is the total value of all:
 a. goods and services produced in a country adjusted for inflation.
 b. goods and services produced in a country without an adjustment for inflation.
  c. final goods and produced in a country services adjusted for inflation.
 d. final goods and services produced in a country without adjustment for inflation.

Question 13

A fixed exchange rate can be an equilibrium rate even if there is a permanent shift in the foreign exchange market supply and demand curves.
 a. True
  b. False
  Indicate whether the statement is true or false