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8. What is the definition of foreign exchange rate?
C
7. What is an advantage of a floating exchange rate for an economy?
A
6. What would increase the demand for a country’s currency on the foreign exchange market?
C
5. What will be the new price of the product in the US?
B
4. Which factor would cause a country’s exchange rate to fall?
A
3. How might it affect the US dollar?
C
2. What is the new equilibrium point?
B
1. What is most likely to cause the demand curve for US dollars to shift from D1 to D2?
B
9. What is most likely to result from a reduction in the value of a country’s currency if there are no other changes in the economy?
C
10. What is an immediate effect for a country of a fall in its foreign exchange rate?
D
