The asset market approach to exchange rate determination seeks to predict
A. the forward exchange rate premiums.
B. the long-run trends in exchange rates.
C. the short-term pressures on exchange rates.
D. the possibility of retaining a pegged exchange rate by the government.
Answer: C
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The elasticity of supply is defined as the ____ change in quantity supplied divided by the ____ change in price
a. total; percentage b. percentage; marginal c. marginal; percentage d. percentage; percentage
Which of the following will be most likely to cause the production possibilities curve for a country to shift inward?
a. an increase in the labor force b. an increase in unemployment c. development of an improved technological method of production d. a decrease in the stock of physical capital
Which of the following statements is true?
A. There was a great deal of stagflation in the 1930s. B. The inflation rate fell during the Eisenhower Administration, but rose during the Reagan years. C. Output in the United States fell by about one-third between 1929 and 1933. D. The Medicare and Medicaid programs were inaugurated during the New Deal.
One criticism of the corporate income tax is that
A. it is so complex to administer that corporate income taxes are rarely collected by the Internal Revenue Service. B. it is too regressive. C. a portion of the corporations' tax burden is passed on to consumers via higher prices for goods and services and to workers via lower wages. D. it is too flat.