Economics of Money, Banking and Financial Markets 12th edition by Frederic Mishkin Test bank
Answer: C
Ques Status: Previous Edition
AACSB: Diverse and Multicultural Work Environments
8) From 1980 to early 1985 the dollar ________ in value, thereby benefiting American ________.
A) appreciated; consumers
B) appreciated; businesses
C) depreciated; consumers
D) depreciated; businesses
Answer: A
Ques Status: Previous Edition
AACSB: Diverse and Multicultural Work Environments
9) From 1980 to 1985 the dollar appreciated relative to the British pound. Holding everything else constant, one would expect that, when compared to 1980
A) fewer Britons traveled to the United States in 1985.
B) Britons imported more wine from California in 1985.
C) Americans exported more wheat to England in 1985.
D) more Britons traveled to the United States in 1985.
Answer: A
Ques Status: Previous Edition
AACSB: Diverse and Multicultural Work Environments
10) When in 1985 a British pound cost approximately $1.30, a Shetland sweater that cost 100 British pounds would have cost $130. With a weaker dollar, the same Shetland sweater would have cost
A) less than $130.
B) more than $130.
C) $130, since the exchange rate does not affect the prices that American consumers pay for foreign goods.
D) $130, since the demand for Shetland sweaters will decrease to prevent an increase in price due to the stronger dollar.
Answer: B
Ques Status: Previous Edition
AACSB: Diverse and Multicultural Work Environments
11) Everything else held constant, a decrease in the value of the dollar relative to all foreign currencies means that the price of foreign goods purchased by Americans
A) increases
B) decreases.
C) remains unchanged.
D) either increases, decreases, or remains unchanged.
Answer: A
Ques Status: Previous Edition
AACSB: Diverse and Multicultural Work Environments
12) American farmers who sell beef to Europe benefit most from
A) a decrease in the dollar price of euros.
B) an increase in the dollar price of euros.
C) a constant dollar price for euros.
D) a European ban on imports of American beef.
Answer: B
Ques Status: Previous Edition
AACSB: Diverse and Multicultural Work Environments
13) If the price of a euro (the European currency) increases from $1.00 to $1.10, then, everything else held constant
A) a European vacation becomes less expensive.
B) a European vacation becomes more expensive.
C) the cost of a European vacation is not affected.
D) foreign travel becomes impossible.
Answer: B
Ques Status: Previous Edition
AACSB: Application of Knowledge
14) Everything else held constant, Americans who love French wine benefit most from
A) a decrease in the dollar price of euros.
B) an increase in the dollar price of euros.
C) a constant dollar price for euros.
D) a ban on imports from Europe.
Answer: A
Ques Status: Previous Edition
AACSB: Application of Knowledge
15) From 2002 to 2011, the dollar depreciated substantially against other currencies. This drop in value most likely benefitted
A) European citizens traveling in the U.S.
B) U.S. citizens traveling in Europe.
C) U.S. manufacturers importing parts from abroad.
D) U.S. citizens purchasing foreign-made automobiles.
Answer: A
Ques Status: Previous Edition