An increase in the target federal funds rate will most likely lead to an increase in:
A: business investment in fixed assets.
B: consumer spending on durable goods.
C: the foreign exchange value of the U.S. dollar.
A: business investment in fixed assets.
B: consumer spending on durable goods.
C: the foreign exchange value of the U.S. dollar.
举一反三
- Consider that Britain is trying to maintain a fixed exchange rate with respect to the U.S. dollar. However, the present situation in the foreign exchange market is conducive for the British pound to depreciate with respect to the U.S. dollar. If the British government uses sterilized intervention in the foreign exchange market, then:
- In the foreign exchange market, what could be a possible consequence of an increase in the purchase of stocks of Toyota, a Japanese automobile firm, by U.S. residents? A: Demand for the dollar will increase B: Yen will depreciate C: The dollar will depreciate D: The supply curve for the dollar will shift to the left
- The real exchange rate, is defined as the price of the home goods in terms of the foreign goods. ( )
- Assume the Fed wants to stimulate economic activity through expansionary monetary policy. Which of the following is FALSE? A: investment spending will increase B: spending on durable goods will increase C: aggregate demand will be stimulated D: the expansionary effect will only be temporary E: real money balances will increase as we move along the AD-curve from left to right
- Which one of the following statements is the MOST accurate? A: A rise in the interest rate offered by dollar deposits causes the dollar to appreciate. B: A rise in the interest rate offered by dollar deposits causes the dollar to depreciate. C: A rise in the interest rate offered by dollar deposits does not affect the U.S. dollar. D: For a given euro interest rate and constant forward exchange rate, a rise in the interest rate offered by dollar deposits causes the dollar to appreciate.