A fixed exchange rate, plus perfect capital mobility ________ the scope for monetary policy ?

Related Mcqs:

1. When capital mobility is perfect interest rate differentials will tend to be offset by ?

   A. Price difference B. balance of payments difference C. current account differences D. expected exchange rate changes...

2. perfect international capital mobility suggests that international funds will be responsive to ________ differentials?

   A. current account B. interest rate C. tax D. price...

3. Which exchange rate system does not require monetary reserves for official exchange rate intervention ?

   A. floating exchange rates B. pegged exchanged rates C. managed floating exchange rates D. dual exchange rates...

4. Which exchange rate system involves a leaning against the wind|| strategy in which short-term fluctuations in exchange rates are reduced without adhering to any particular exchange rate over the long run ?

   A. pegged of fixed exchange rates B. adjustable pegged exchange rates C. managed floating exchange rates D. free floating exchange rates...

5. In a fixed exchange rate regime, the central the exchange rate ?

   A. selling, increase B. buying reduce C. selling, reduce D. buying increase E. A and B F. C and D...

6. If a country’s policy makers were to continuously use expansionary monetary policy in an attempt to hold unemployment below the natural rate the long-run result would be ?

   A. an increase in the level of output B. a decrease in the unemployment rate C. an increase in the rate of inflation D. All of these answers...

7. Which exchange rate mechanism in intended to insulate the balance of payments from short-term capital movements while providing exchange rate stability for commercial transactions ?

   A. dual exchange rates B. managed floating exchange rates C. adjustable pegged exchange rates D. crawling pegged exchange rates...

8. 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?

   A. decrease; depreciate B. decrease; appreciate C. increase; depreciate D. increase; appreciate...

9. One of the transmission mechanisms of monetary policy is through consumer demand when interest rates ________ household wealth ________ and consumption _________?

   A. rise; increase, increase B. rise, falls, increase C. rise, increase, falls D. rise, falls, falls...

10. Which fixed exchange rates and no private capital flows, to correct a balance of payments deficit, the central bank will _______ and ________ ?

    A. buy foreign exchange, sell domestic currency B. sell foreign exchange buy domestic currency C. buy foreign exchange buy domestic currency D. sell foreign exchange sell domestic currency...