Question 1

Implementing a fixed exchange rate regime increases the price inflation in countries.

Accepted Answer

A) True 
 B)False

Question 2

The World Bank was established at the at Bretton Woods conference to _____.

Accepted Answer

A)  establish an international monetary system 
B)  promote general economic development 
C)  establish gold standard across the world 
D)  fund the initiatives of the United Nations 
A)  establish an international monetary system 
B)  promote general economic development 
C)  establish gold standard across the world 
D)  fund the initiatives of the United Nations

Question 3

Discuss the arguments that favor a floating exchange rate system against a fixed exchange rate system.

Accepted Answer

There are two main elements in the case

Question 4

What will happen if a country increases its money supply rapidly under fixed exchange rate regime?

Accepted Answer

A)  Imports will become less attractive in that country. 
B)  The country will face negative inflation. 
C)  Trade deficit would widen in that country. 
D)  The country's products will become more attractive in world markets. 
A)  Imports will become less attractive in that country. 
B)  The country will face negative inflation. 
C)  Trade deficit would widen in that country. 
D)  The country's products will become more attractive in world markets.

Question 5

The fixed exchange rate system established at Bretton Woods failed due to speculative pressures on the U.S.dollar.

Accepted Answer

A) True 
 B)False

Question 6

Contracting out manufacturing allows companies to reduce economic exposure because _____.

Accepted Answer

A)  having multiple suppliers attracts subsidies from government 
B)  it reduces the pressure on them to maintain a trade surplus 
C)  it allows companies to shift suppliers from country to country 
D)  quality issues are insignificant when manufacturing is contracted to others 
A)  having multiple suppliers attracts subsidies from government 
B)  it reduces the pressure on them to maintain a trade surplus 
C)  it allows companies to shift suppliers from country to country 
D)  quality issues are insignificant when manufacturing is contracted to others

Question 7

The amount of a currency needed to purchase one ounce of gold was referred to as the gold par value under the gold standard.

Accepted Answer

A) True 
 B)False

Question 8

Which of the following arguments is in favor of floating exchange rates?

Accepted Answer

A)  A country's ability to expand or contract its money supply should be limited by the need to maintain exchange rate parity. 
B)  Maintaining balance of trade equilibrium is not in the best interest of a country. 
C)  Countries can isolate themselves from uncertainties when they trade using a mutually agreed on exchange rate. 
D)  Governments can restore monetary control by removing the obligation to maintain exchange rate parity. 
A)  A country's ability to expand or contract its money supply should be limited by the need to maintain exchange rate parity. 
B)  Maintaining balance of trade equilibrium is not in the best interest of a country. 
C)  Countries can isolate themselves from uncertainties when they trade using a mutually agreed on exchange rate. 
D)  Governments can restore monetary control by removing the obligation to maintain exchange rate parity.

Question 9

Which of the following changes were made to IMF's Articles of Agreement in the Jamaica agreement?

Accepted Answer

A)  IMF members were permitted to use Dollar as the convertible currency. 
B)  Gold was declared as a formal reserve asset for IMF members. 
C)  IMF members were permitted to sell their gold reserves at the market price. 
D)  IMF members were restricted from entering the foreign exchange market. 
A)  IMF members were permitted to use Dollar as the convertible currency. 
B)  Gold was declared as a formal reserve asset for IMF members. 
C)  IMF members were permitted to sell their gold reserves at the market price. 
D)  IMF members were restricted from entering the foreign exchange market.

Question 10

The monetary autonomy argument is supported by the advocates of fixed exchange rates.

Accepted Answer

A) True 
 B)False

Question 11

How can international companies reduce their economic exposure in a world of constantly fluctuating exchange rates?

Accepted Answer

For companies operating in a world of vo

Question 12

A currency crisis occurs due to _____.

Accepted Answer

A)  the loss of confidence in a country's banking system 
B)  heavy foreign debt obligations 
C)  high levels of trade deficit 
D)  a speculative attack on the exchange value 
A)  the loss of confidence in a country's banking system 
B)  heavy foreign debt obligations 
C)  high levels of trade deficit 
D)  a speculative attack on the exchange value

Question 13

Which of the following statements is true of pegged exchange rates?

Accepted Answer

A)  A pegged exchange rate allows a country's currency to be determined by market forces. 
B)  A pegged exchange rate weakens the monetary discipline of a country. 
C)  Pegged exchange rates are popular among many of the world's smaller nations. 
D)  Adopting a pegged exchange rate regime increases inflationary pressures in a country. 
A)  A pegged exchange rate allows a country's currency to be determined by market forces. 
B)  A pegged exchange rate weakens the monetary discipline of a country. 
C)  Pegged exchange rates are popular among many of the world's smaller nations. 
D)  Adopting a pegged exchange rate regime increases inflationary pressures in a country.

Question 14

Compare currency crisis,banking crisis,and foreign debt crisis.

Accepted Answer

A currency crisis occurs when a speculat

Question 15

A country is said to be in balance-of-trade equilibrium when _____.

Accepted Answer

A)  it has the potential to produce all goods that its residents want without engaging in foreign trade 
B)  the income its residents earn from exports is equal to the money its residents pay for imports 
C)  the country import all goods that its residents want by engaging in foreign trade 
D)  it has the potential to balance the production and procurement of the basic amenities that it needs 
A)  it has the potential to produce all goods that its residents want without engaging in foreign trade 
B)  the income its residents earn from exports is equal to the money its residents pay for imports 
C)  the country import all goods that its residents want by engaging in foreign trade 
D)  it has the potential to balance the production and procurement of the basic amenities that it needs

Question 16

Explain the floating exchange rate regime.Give examples.

Accepted Answer

When the foreign exchange market determi

Question 17

Identify the currency that was convertible to gold under the Bretton Woods system.

Accepted Answer

A)  Pound 
B)  Yen 
C)  Euro 
D)  Dollar 
A)  Pound 
B)  Yen 
C)  Euro 
D)  Dollar

Question 18

Currencies of countries with currency boards will become uncompetitive and overvalued if local inflation rates are lower than the inflation rate in the country to which the currency is pegged.

Accepted Answer

A) True 
 B)False

Question 19

The agreement reached at Bretton Woods established _____.

Accepted Answer

A)  International Monetary Fund 
B)  World Economic Forum 
C)  United Nations 
D)  International Atomic Energy Agency 
A)  International Monetary Fund 
B)  World Economic Forum 
C)  United Nations 
D)  International Atomic Energy Agency

Question 20

What is the Bretton Woods agreement? How was it different from the gold standard?

Accepted Answer

The Bretton Woods agreement,signed in 19

Implementing a fixed exchange rate regime increases the price inflation in countries.

The World Bank was established at the at Bretton Woods conference to _____.

Discuss the arguments that favor a floating exchange rate system against a fixed exchange rate system.

What will happen if a country increases its money supply rapidly under fixed exchange rate regime?

The fixed exchange rate system established at Bretton Woods failed due to speculative pressures on the U.S.dollar.

Contracting out manufacturing allows companies to reduce economic exposure because _____.

The amount of a currency needed to purchase one ounce of gold was referred to as the gold par value under the gold standard.

Which of the following arguments is in favor of floating exchange rates?

Which of the following changes were made to IMF's Articles of Agreement in the Jamaica agreement?

The monetary autonomy argument is supported by the advocates of fixed exchange rates.

How can international companies reduce their economic exposure in a world of constantly fluctuating exchange rates?

A currency crisis occurs due to _____.

Which of the following statements is true of pegged exchange rates?

Compare currency crisis,banking crisis,and foreign debt crisis.

A country is said to be in balance-of-trade equilibrium when _____.

Explain the floating exchange rate regime.Give examples.

Identify the currency that was convertible to gold under the Bretton Woods system.

Currencies of countries with currency boards will become uncompetitive and overvalued if local inflation rates are lower than the inflation rate in the country to which the currency is pegged.

The agreement reached at Bretton Woods established _____.

What is the Bretton Woods agreement? How was it different from the gold standard?

Globalization

National Differences in Political Economy

Political Economy and Economic Development

Differences in Culture

Ethics in International Business

International Trade Theory

The Political Economy of International Trade

Foreign Direct Investment

Regional Economic Integration

The Foreign Exchange Market

The Global Capital Market

The Strategy of International Business

The Organization of International Business

Entry Strategy and Strategic Alliances

Exporting, Importing, and Countertrade

Global Production, Outsourcing, and Logistics

Global Marketing and RD

Global Human Resource Management

Accounting and Finance in the International Business

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Exam 11: The International Monetary System

Implementing a fixed exchange rate regime increases the price inflation in countries.

The World Bank was established at the at Bretton Woods conference to _____.

Discuss the arguments that favor a floating exchange rate system against a fixed exchange rate system.

What will happen if a country increases its money supply rapidly under fixed exchange rate regime?

The fixed exchange rate system established at Bretton Woods failed due to speculative pressures on the U.S.dollar.

Contracting out manufacturing allows companies to reduce economic exposure because _____.

The amount of a currency needed to purchase one ounce of gold was referred to as the gold par value under the gold standard.

Which of the following arguments is in favor of floating exchange rates?

Which of the following changes were made to IMF's Articles of Agreement in the Jamaica agreement?

The monetary autonomy argument is supported by the advocates of fixed exchange rates.

How can international companies reduce their economic exposure in a world of constantly fluctuating exchange rates?

A currency crisis occurs due to _____.

Which of the following statements is true of pegged exchange rates?

Compare currency crisis,banking crisis,and foreign debt crisis.

A country is said to be in balance-of-trade equilibrium when _____.

Explain the floating exchange rate regime.Give examples.

Identify the currency that was convertible to gold under the Bretton Woods system.

Currencies of countries with currency boards will become uncompetitive and overvalued if local inflation rates are lower than the inflation rate in the country to which the currency is pegged.

The agreement reached at Bretton Woods established _____.

What is the Bretton Woods agreement? How was it different from the gold standard?

Globalization

National Differences in Political Economy

Political Economy and Economic Development

Differences in Culture

Ethics in International Business

International Trade Theory

The Political Economy of International Trade

Foreign Direct Investment

Regional Economic Integration

The Foreign Exchange Market

The Global Capital Market

The Strategy of International Business

The Organization of International Business

Entry Strategy and Strategic Alliances

Exporting, Importing, and Countertrade

Global Production, Outsourcing, and Logistics

Global Marketing and RD

Global Human Resource Management

Accounting and Finance in the International Business

Filters