If the US economy is forecast to come out of recession because military expenditure has increase then the exchange value of the UK pound will tend to ?

Related Mcqs:

1. If currency dealers expect the value of the pound to fall, the exchange value will tend to ?

   A. depreciate
   B. not be affected
   C. fluctuate more than it would do therwise
   D. appreciate

2. When the $/£ exchange rate rises the pound _____ and when the $/£ rates falls the pound ________?

   A. depreciates, appreciates
   B. revalues, devalues
   C. appreciates, depreciates
   D. becomes more expensive becomes cheaper

3. Refers to Exhibit 4. Suppose the economy is operating in a recession such as point B in Exhibit 4. If policy makers allow the economy to adjust to the long run natural rate on its own, ?

   A. People will reduce their price expectations and the short run aggregate supply will shift right
   B. People will raise their price expectations and aggregate demand will shift left
   C. People will raise their price expectations and the short run aggregate supply will shift left
   D. People will reduce their price expectations and aggregate demand will shift right

4. Under a system of floating exchange rates the pound would depreciate in value if there occurs ?

   A. Price inflation in the United States
   B. an increase in U.S real income
   C. a decrease in the British money supply
   D. falling interest rates in Britain

5. The multiple by which total deposits can increase for every pound increase in reserves is the ?

   A. Money multiplier
   B. liquidity ratio
   C. bank’s line of credit
   D. required reserve ratio

6. Refers to Exhibit 4. Suppose the economy is operating in a recession such as point B in Exhibit 4. If policy makers wished to move output to its long run natural rate they should attempt to ?

   A. Shift aggregate demand to the left
   B. Shift short run aggregate supply to the left
   C. shift aggregate demand to the right
   D. shift short-run aggregate supply to the right

7. 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

8. Refer to Exhibit 6.Suppose the economy is in long-run equilibrium at point E. A sudden increase in government spending should move the economy in the direction of point ?

   A. d
   B. G
   C. E
   D. b

9. If the Pakistan takes part in a war in the Middle East, then the exchange value of its currency will tend to ?

   A. depreciate
   B. not be affected
   C. fluctuate more than if it were at peace
   D. appreciate

10. If the Pakistan receives larger than expected revenues from exports then the exchange value of its currency will tend to ?

    A. not be affected
    B. fluctuate more than if exports were lower
    C. depreciate
    D. appreciate