[{"id":214277,"question":"If export's are a constant proportion of GNP such that E = 18 GNP, find the level of imports that would represent a zero trade balance when GNP = 10,000","choices":[{"text":"180","value":"A"},{"text":"555","value":"B"},{"text":"1,800","value":"C"},{"text":"5,555","value":"D"},{"value":"E"}],"correctAnswer":3},{"id":214276,"question":"Prohibiting a trade between two people","choices":[{"text":"Will promote economic efficiency","value":"A"},{"text":"Probably Will inhibit productive efficiency","value":"B"},{"text":"Might be necessary if resources are to be put to their most highly valued uses","value":"C"},{"text":"Will have no effect on other persons.","value":"D"},{"value":"E"}],"correctAnswer":2},{"id":214275,"question":"Trade based on comparative advantage assures that.","choices":[{"text":"Only the strongest suvrive","value":"A"},{"text":"Some people are rich and others are poor","value":"B"},{"text":"Each item is produced using the least amount of time needed to produce it","value":"C"},{"text":"Each item is produced at as low a cost possible in terms of other things given up","value":"D"},{"value":"E"}],"correctAnswer":4},{"id":214274,"question":"according to factor price equalization theorem, if country A is labor abundant then once trade opens.","choices":[{"text":"Wages and rents should fall in A","value":"A"},{"text":"Wages and rents should rise in A","value":"B"},{"text":"Wages should rise and rents should fall in A","value":"C"},{"text":"Wages should fall and rents should rise in A","value":"D"},{"value":"E"}],"correctAnswer":3},{"id":214273,"question":"Small nations with more than one major trading partner lend to peg the value of their currencies to.","choices":[{"text":"gold","value":"A"},{"text":"silver","value":"B"},{"text":"a single currency","value":"C"},{"text":"a basket of currencies","value":"D"},{"value":"E"}],"correctAnswer":4},{"id":214272,"question":"Small nations whose trade and financial relationships are mainly with a single partner tend to utilize.","choices":[{"text":"Pegged exchange rates","value":"A"},{"text":"Freely floating exchanged rates","value":"B"},{"text":"Managed floating exchange rates","value":"C"},{"text":"Crewing exchange rates.","value":"D"},{"value":"E"}],"correctAnswer":1},{"id":214271,"question":"Which exchange rate system does not require monetary reserves for official exchange rate intervention.","choices":[{"text":"Floating exchange rates","value":"A"},{"text":"Pegged exchange rates","value":"B"},{"text":"Managed floating exchange rates","value":"C"},{"text":"Dual exchange rates","value":"D"},{"value":"E"}],"correctAnswer":1},{"id":214270,"question":"Which exchange rate mechanism calls for frequent redefining of the par value by small amounts to remove payments disequilibrium.","choices":[{"text":"Dual exchange rates","value":"A"},{"text":"Adjustable pegged exchange rates","value":"B"},{"text":"Managed floating exchange rates","value":"C"},{"text":"Crawling pegged exchange rates.","value":"D"},{"value":"E"}],"correctAnswer":4},{"id":214269,"question":"Which exchange rate mechanism is intended to insulates the balance of payments from short term capital movements while providing exchange rate stability for commercial transactions.","choices":[{"text":"Dual exchange rates","value":"A"},{"text":"Managed floating exchange rates","value":"B"},{"text":"Adjustable pegged exchange rates","value":"C"},{"text":"Crawling pegged exchange rates.","value":"D"},{"value":"E"}],"correctAnswer":1},{"id":214268,"question":"The exchange rate system that best characterizes the present international monetary arrangement used by industrialized countries is.","choices":[{"text":"Freely fluctuating exchange rates","value":"A"},{"text":"Adjustable pegged exchange rates","value":"B"},{"text":"Managed floating exchange rate.","value":"C"},{"text":"Pegged or fixed exchange rates","value":"D"},{"value":"E"}],"correctAnswer":3},{"id":214267,"question":"The balance of trade can only worsen if income_______ relative to absorption","choices":[{"text":"Increases","value":"A"},{"text":"Decreases","value":"B"},{"text":"Does not change","value":"C"},{"text":"None of the above","value":"D"},{"value":"E"}],"correctAnswer":2},{"id":214266,"question":"The balance of trade can only worsen if income________ relative to absorption","choices":[{"text":"Increases","value":"A"},{"text":"Decreases","value":"B"},{"text":"Adjustment mechanism","value":"C"},{"text":"Currency contract period","value":"D"},{"value":"E"}],"correctAnswer":2},{"id":214265,"question":"the_____________ analysis considers the ability of domestic and foreign prices to adjust to devaluation in the short run.","choices":[{"text":"Pass through","value":"A"},{"text":"Absorption","value":"B"},{"text":"Adjustment mechanism","value":"C"},{"text":"currency contract period","value":"D"},{"value":"E"}],"correctAnswer":1},{"id":214264,"question":"The asset market approach is most helpful in explaining.","choices":[{"text":"Why exchange rate remain quite stable","value":"A"},{"text":"Why government change their money supplies","value":"B"},{"text":"Long term exchange rate movements","value":"C"},{"text":"Short term exchange rate movements","value":"D"},{"value":"E"}],"correctAnswer":4},{"id":214263,"question":"Exchange rate overshooting often occur because.","choices":[{"text":"Domestic prices adjust slowly to shifts in demand","value":"A"},{"text":"Military spending increases during military's confects","value":"B"},{"text":"Elasticities are smaller in the long run than the short run","value":"C"},{"text":"Elasticities are smaller in the short run than the long run.","value":"D"},{"value":"E"}],"correctAnswer":4},{"id":214262,"question":"When the price of foreign currency the exchange is above the equilibrium level.","choices":[{"text":"an excess supply of that currency exists in the foreign exchange market.","value":"A"},{"text":"an excess demand for that currency exists in the foreign exchange market","value":"B"},{"text":"The supply of foreign exchange shifts outward to the right","value":"C"},{"text":"the supply of foreign exchange shifts backward to the left","value":"D"},{"value":"E"}],"correctAnswer":1},{"id":214261,"question":"When the price of foreign currency exchange is above the equilibrium level.","choices":[{"text":"An excess demand for that currency exists in the foreign exchange market.","value":"A"},{"text":"An excess supply of the currency exists in the foreign exchange market","value":"B"},{"text":"The demadn for foreign exchange shifts outward to the right","value":"C"},{"text":"The demand for foreign exchange shifts backward to the left.","value":"D"},{"value":"E"}],"correctAnswer":1},{"id":214260,"question":"The relationship between the exchange rate ad the prices of tradable goods is known as the.","choices":[{"text":"Purchasing power parity theory","value":"A"},{"text":"Asset markets theory","value":"B"},{"text":"Monetary theory","value":"C"},{"text":"Balance of payments theory","value":"D"},{"value":"E"}],"correctAnswer":1},{"id":214259,"question":"currency speculation is__________ if speculators bet against market forces that cause exchange fluctuations, thus moderating such fluctuations.","choices":[{"text":"Destabilizing","value":"A"},{"text":"Stabilizing","value":"B"},{"text":"Inflationary","value":"C"},{"text":"Deflationary","value":"D"},{"value":"E"}],"correctAnswer":2},{"id":214258,"question":"Investors engage in ____ when they move funds into foreign currencies in order to take advantage of interest rates abroad the are higher than domestic interest rates.","choices":[{"text":"Currency arbitrage","value":"A"},{"text":"Interest arbitrage","value":"B"},{"text":"Short positions","value":"C"},{"text":"Long positions","value":"D"},{"value":"E"}],"correctAnswer":2}]