To know whether the dollar is overvalued, we need to know
A) what foreign currency the dollar is being compared with.
B) the real interest rate in the United States and the real interest rate in whatever country's currency the dollar is being compared with.
C) the equilibrium exchange rate between the dollar and the foreign currency the dollar is being compared with.
D) whether Federal Reserve monetary policy is expansionary or contractionary.
E) There is not enough information to answer the question.
C
You might also like to view...
The funds that polluters pay that gives them the right to discharge into the air or water a certain amount of pollution are
A) special subsidies. B) regulation fees. C) external costs. D) effluent fees.
One way to ensure all producers benefit from a price floor is to:
A. give a government guarantee to buy all surplus. B. ration a certain quantity per consumer. C. ration a certain quantity per producer . D. All of these are examples of ensuring all producers benefit using non-price methods.
Over long periods of time, the growth rates of actual and potential GDP have been
a. diverging. b. similar. c. declining together. d. usually far apart.
One of the major issues in the Uruguay round of GATT was
A. the placement of the WTO offices in Uruguay. B. the use of trade as a diplomatic weapon. C. the question of the Euro's convertibility. D. domestic content provisions for movies and television.