In the early eighties, the Federal Reserve pursed a tight monetary policy. All else being equal. the impact of that policy was to interest rates in the United States relative to those in Europe and cause the dollar to _______ against European currencies?

Related Mcqs:

Given the foreign currency market for the Swiss franc, the supply of franc slopes upward, because as the dollar price of the franc rises ?

A. America’s demand for Swiss merchandise rises B. America’s demand for Swiss merchandise falls C. Switzerland’s demand for American merchandise rises D. Switzerland’s demand for American merchandise falls...

The reduction or covering of foreign exchange risk is called ?

A. hedging B. speculation C. intervention D. arbitrage...

Investor engage in _____ when they move funds into foreign currencies in order to take advantage to interest rates abroad that are higher than domestic interest rates ?

A. currency arbitrage B. interest arbitrage C. short positions D. long positions...

All currencies other than the domestic currency of a given country are referred to as ?

A. hard currency B. foreign exchange C. reserve currencies D. near monies...

Under a system of floating exchange rates there is a general tendency for ?

A. exchange rates to be insensitive to the differential rates of inflation between countries B. the currencies of relatively high-inflation countries to depreciate C. the currencies of relatively high inflation countries to appreciate D. the currencies of relatively low inflation countries to depreciate...