Use the following graph, which shows the market for euros, to answer the next question. Q*=1 Euro.
Assume the U.S. and European governments adopt a system of flexible exchange rates. One U.S. dollar will purchase how many euros?
A. 1.11 euros
B. 0.90 euro
C. 1.90 euros
D. 1.00 euro
Answer: A
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Suppose the government of New Country fixes the exchange rate of its currency, the Newo, in terms of the U.S. dollar. Initially the exchange rate is set at $0.50 per Newo. Later the government changes the exchange rate to $0.75 per Newo. This is an example of a(n):
A. appreciation B. revaluation C. depreciation D. devaluation
Recently, Skooterville has experienced a large growth in population. As a result, the demand curve for telephone service in Skooterville:
A) has shifted to the right. B) has shifted to the left. C) has shifted down. D) Both B and C are correct. E) none of the above
In a situation where a car salesman is selling cars on behalf of the dealer, the salesman is the
a. Principal b. Agent c. Both of the above d. None of the above
Federal government spending as a percentage of GDP was the highest since 1960 during: a. the Great Depression
b. the aftermath of the oil crisis in the Gulf nations. c. World War II. d. the aftermath of the Great Recession.