Exchange rates

Related MCQs

• Suppose the exchange rates between the United States and Euro Area are in long-run equilibrium as defined by the idea of purchasing power parity. If the law of one price holds perfectly, then differences between U.S. and Euro Area rates of inflation would
• The exchange rate mechanism (ERM) crisis in 1992 represents the __________ in German interest rates that caused other European interest rates to __________, and resulted in less aggregate spending.
• A _______ involves an exchange of currencies between two parties, with a promise to re-exchange currencies at a specified exchange rate and future date.
• A _______ involves an exchange of currencies between two parties, with a promise to re- exchange currencies at a specified exchange rate and future date.
• An increase in UK interest rates relative to euro interest rates is likely to ________ the UK demand for euros and _________ the supply of euros for sale.
• The international Fisher effect suggests that should pound interest rates exceed US dollar interest rates:
• A firm that buys foreign exchange in order to take advantage of higher foreign interest rates is
• All else equal and under a system of floating exchange rates, if a country enters a period of exceptionally strong growth,
• Theory which considers change in exchange rate with fluctuations in inflation rates is classified as
• Authority which intervenes directly or indirectly in foreign exchange markets by altering interest rates is considered as