Exchange Rates Practice Questions

Which of the following might occur following a depreciation of the domestic currency (tick multiple). Clue: Consider the Impact on AD/AS.
A rise in employment.
A fall in employment.
A rise in SR economic growth.
A fall in SR economic growth.
A rise in demand-pull inflationary pressure.
A fall in demand-pull inflationary pressure.
Cost of Imports increase.
Cost of Imports decrease.
Firms Profits increase.
Firms Profits decrease.
Cost-push inflationary pressure.
Cost-push deflationary pressure.
An increase in exports would lead to an increase in the demand for the currency?
True
False
An increase in imports would lead for the supply curve to shift: left or right?
Left
Right
An increase in inward FDI would lead to an:
Appreciation
Depreciation
Expecations that the ยฃ will rise may lead to:
A) An increase in the Demand for the Currency.
B) An increase in the Supply of the Currency.
C) A decrease in the demand for the currency.
D) A decrease in the Supply for the currency.
What is the equilibrium following an increase in imports and and increase in exports?
 
pic 1
A)
B)
C)
D)
What is the equilibrium following an increase in consumer incomes both in the UK and abroad?
 
pic 1
A)
B)
C)
D)
What is the equilibrium following an increase in the interest rate, coupled with an decrease in the demand for imports?
 
pic 2
A)
B)
C)
D)
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