A. comparative advantage
B. absolute advantage
C. opportunity cost
D. relative costs
Related Mcqs:
- 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 - The theory of international exchange that holds that exchange rates adjust to offset differences in countries inflation rates in the ?
A. price feedback theory
B. trade feedback theory
C. J-curve theory
D. purchasing power parity theory - The University of Pennsylvania researchers Summers and Heston compute the price level of GDP as the ratio of purchasing power parity (PPP) exchange rate to the actual exchange rate where ?
A. both exchange rates are measured s the domestic currency price of the US-dollar
B. both exchange rates are not converted into international dollars
C. both exchange rate are pegged
D. both exchange rate are converted into Big Mac PPP formula - When the price of foreign currency (i.e the exchange rate) is below the equilibrium level ?
A. an excess demand for that currency exists in the foreign exchange market
B. an excess supply of the currency exists in the foreign exchange market
C. the demand for foreign exchange shifts outward to the right
D. the demand for foreign exchange shifts backward to the left - When the price of foreign currency (the exchange rate) is above the equilibrium level ?
A. an excess supply of that currency exists in the foreign exchange market
B. an excess demand for that currency exists in the foreign exchange market
C. the supply of foreign exchange shifts outward to the right
D. the supply of foreign exchange shifts backward to the left - What is the rate of exchange or exchange rate ?
A. Power to buy foreign currency
B. Foreign currency holding
C. Ratio at which unit of one country’s currency is exchanged for unit of another country currency
D. None of them - 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 - 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 - 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 - Suppose that the purchasing power parity estimate of the dollar/euro exchange rate is $1.30 per euro, and the current spot rate is $1.3 8 per euro. Comparing these two exchange rates from a long-run viewpoint you would ?
A. anticipate the dollar to depreciate against the euro
B. anticipate the dollar to appreciate against the euro
C. anticipate the dollar’s exchange rate against the euro to remain constant
D. have no anticipation concerning future movements in the dollar/euro exchange rate
