Assume identical interest rates on comparable securities in the United States and foreign countries. Suppose investors anticipate that in the future the U.S dollar will depreciate against foreign currencies. investment funds would tend to ?
A. flow from the United States to foreign countries
B. flow from foreign countries to the United States
C. remain totally in foreign countries
D. remain totally in the United States
A. 0.67 pesos = $1
B. 0.8 pesos = $1
C. 1.25 pesos = $1
D. 1.67 pesos = $1
A. appreciation; trade surplus
B. appreciation; trade deficit
C. depreciation; trade surplus
D. depreciation; trade deficit
A. decrease in the money supply
B. increase in the money supply
C. decrease in the money demand
D. None of the above
A. faster economic growth than Japan
B. higher future interest rates than Japan
C. more rapid money supply growth than japan
D. higher inflation rates than japan
Given a system of floating exchange rates falling income in the United States would trigger a (an) ?
A. increase in the demand for imports and an increase in the demand for foreign currency
B. increase in the demand for imports and a decrease in the demand for foreign currency
C. decrease in the demand for imports and an increase in the demand for foreign currency
D. decrease in the demand for imports and a decrease in the demand for foreign currency