With flexible exchange rates, an increase in U.S. interest rates can be expected to ________.
A. lower the foreign exchange value of the dollar
B. adversely affect U.S. exporters
C. cause a net outflow of foreign capital from the United States
D. encourage investment spending by U.S. firms
Answer: B
You might also like to view...
When access to a common property is unrestricted, why does the resulting social gain fail to be as large as possible? How can an entrance fee increase social gain in this situation?
What will be an ideal response?
A multinational agency that specializes in making loans to a larger number of developing nations to promote long-term development and growth is
A) the International Bank. B) the World Bank. C) the International Monetary Fund. D) the World Monetary Fund.
When raising taxes, the quantity effect tells us that the:
A. government gets more revenue per units sold. B. higher tax rate causes fewer units to be sold. C. government gets less revenue per unit sold. D. higher tax rate causes more units to be supplied.
If all prices in the economy go up from one year to the next, the CPI index, using the previous year as the base would
A. be less than 100. B. be greater than 100. C. not be influenced since quantities have remained unchanged. D. not be determined since enough information is given.