Exam 20: International Finance

All else held constant,an increase in U.S.exports will cause the U.S.current account to:

If foreign reserves are fixed,the balance of payments requires that a:

If a country has $55 billion of net capital outflow and a $5 billion increase in its cash reserves and ownership of assets,then the country must be running a trade:

In the long run,an increase in the domestic money supply:

A trade deficit might indicate a problem of:

Those who say the growing current account deficit in the United States is not a significant problem make the argument that:

The most important and volatile component of the current account in the U.S.balance of payments is:

Which of the following increases the demand for the U.S.dollar in the foreign exchange market?

Purchasing power parity is an application of the law of:

Which transactions cause the U.S.capital account to increase?

If the exchange rate between the Japanese yen and the dollar was ¥110 = $1 in 2006 and ¥120 = $1 in 2009,then between 2006 and 2009:

Only underdeveloped countries are eligible to borrow from the IMF.

Most people run a private:

Since 1990,the U.S.current account has been rising in most years.

A trade surplus occurs when the value of a country's:

If the Central Bank of China decides to hold more dollars as reserves,the:

If a country applies dollarization to its currency,it has adopted a:

Consider the exchange market for the U.S.dollar versus the Japanese yen.The supply of yen comes from:

Beginning in 1995,many European nations gave up their own currencies and adopted the euro as a common currency under the supervision of the European Union.Explain one major advantage and one major disadvantage to a group of countries adopting a common currency and setting up a currency union.

Purchasing power parity is more likely to hold in the short run than in the long run.