Exam 21: International Trade and Finance

Other things being equal, an increase in U.S. interest rates would be likely to cause an increase in the capital account surplus or a decrease in the capital account deficit.

If real interest rates in the United States are higher than those of our trading partners, what will tend to happen to the foreign exchange value of the dollar and the U.S. current account deficit or surplus?

An increase in demand for a nation's currency in the foreign exchange market will:

A weaker dollar will stimulate sales of U.S. exports.

The balance of trade is the value of a nation's ____.

Exhibit 21-1  Production possibilities curves In Exhibit 21-1, the production possibilities curves of wheat and corn for Nabia and Pada are presented. If these two nations trade, Nabia should specialize in the production of:

If a country has a lower opportunity cost of producing oranges, then this is:

A strong U.S. dollar is one that has:

If a Japanese stereo priced at 1,000,000 yen can be purchased for $1,000, the exchange rate is:

A fixed exchange rate is:

If the Japanese price level falls relative to the price level in the United States, then:

Exhibit 21-3  Potatoes and wheat output (tons per day) In Exhibit 21-3, Ireland's opportunity cost of producing one unit of wheat is:

Which of the following is the correct name of the free-trade agreement between Mexico, the U.S., and Canada?

Exhibit 21-3  Potatoes and wheat output (tons per day) In Exhibit 21-3, the United States has an absolute advantage in producing:

Purchases of foreign assets by U.S. residents are tabulated in the U.S. balance of payments as a:

Since World War II, tariff reductions have occurred in large part because of negotiations under the:

A tax levied on imported goods is called a(n):

Protective tariffs help a nation reach which of the following goals?

If the dollar appreciates (becomes stronger) this causes:

Comparative advantage indicates that: