strayer university ITB400 QUIZ 2
·Over the last several years the U.S. has run persistent
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· Question 2
3 out of 3 points Generally speaking, any transaction that results in a payment to foreigners
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· Question 3
3 out of 3 points Invisible trade refers to
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· Question 4
3 out of 3 points The current account balance, which is the difference between a country’s exports and imports, is a component of the country’s GNP. Other components of GNP include
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· Question 5
3 out of 3 points The balance of payments identity is given by BCA + BKA + BRA = 0. Rearrange the identity for a country with a pure flexible exchange rate regime.
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· Question 6
0 out of 3 points Under the pure flexible exchange rate regime
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· Question 7
3 out of 3 points The world’s largest debtor nation and creditor nation, respectively, are
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· Question 8
3 out of 3 points More important than the absolute size of a country’s balance-of-payments disequilibrium
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· Question 9
3 out of 3 points As of 2007 gold accounting for
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· Question 10
3 out of 3 points BCA stands for
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· Question 11
3 out of 3 points In a pure flexible exchange rate regime, a country’s central banks will not need to maintain official reserves. Under this regime
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· Question 12
3 out of 3 points The capital account may be divided into three categories:
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· Question 13
3 out of 3 points Suppose the McDonalds Corporation imports Canadian beef, paying for it by transferring the funds to a New York bank account kept by the Canadian Beef producer.
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· Question 14
3 out of 3 points BKA stands for
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· Question 15
3 out of 3 points Which of the following is most indicative of the pressure that a country’s currency faces for depreciation or appreciation?
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· Question 16
3 out of 3 points The current exchange rate is €1.00 = $1.50. Compute the correct balances in Bank A’s correspondent account(s) with bank B if a currency trader employed at Bank A buys €100,000 from a currency trader at bank B for $150,000 using its correspondent relationship with Bank B.
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· Question 17
3 out of 3 points At the wholesale level
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· Question 18
3 out of 3 points Suppose a bank customer with €1,000,000 wishes to trade out of euro and into Japanese yen. The dollar-euro exchange rate is quoted as $1.60 = €1.00 and the dollar-yen exchange rate is quoted at $1.00 = ¥120. How many yen will the customer get?
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· Question 19
0 out of 3 points Suppose you observe the following exchange rates: €1 = $1.50; ¥120 = $1.00. Calculate the euro-pound exchange rate.
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· Question 20
0 out of 3 points The world’s largest foreign exchange trading center is
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· Question 21
3 out of 3 points It is common practice among currency traders worldwide to both price and trade currencies against the U.S. dollar. In fact, 2007 BIS statistics indicate that about _________ of currency trading in the world involves the U.S. dollar on one side of the transaction.
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· Question 22
3 out of 3 points The Bid price
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· Question 23
3 out of 3 points A recent survey of U.S. foreign exchange traders measured traders’ perceptions about how fast news events that cause movements in exchange rates actually change the exchange rate. The survey respondents claim that the bulk of the adjustment to economic announcements regarding unemployment, trade deficits, inflation, GDP, and the Federal funds rate takes place within
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· Question 24
3 out of 3 points It is common practice among currency traders worldwide to both price and trade currencies against the U.S. dollar. Consider a currency dealer who makes a market in 5 currencies against the dollar. If he were to supply quotes for each currency in terms of all of the others, how many quotes would he have to provide?
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· Question 25
3 out of 3 points When a currency trades at a discount in the forward market
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· Question 26
3 out of 3 points Suppose you observe the following exchange rates: €1 = $1.50; £1 = $2.00. Calculate the euro-pound exchange rate.
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· Question 27
3 out of 3 points Most interbank trades are
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· Question 28
3 out of 3 points Suppose you observe the following exchange rates: €1 = $1.60; £1 = $2.00. Calculate the euro-pound exchange rate.
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· Question 29
3 out of 3 points When a currency trades at a premium in the forward market
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· Question 30
3 out of 3 points The AUD/$ spot exchange rate is AUD1.60/$ and the SF/$ is SF1.25/$. The AUD/SF cross exchange rate is _____.
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