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Understanding Exchange Rates

Authored by awe TAIWO

Geography

Professional Development

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Understanding Exchange Rates
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20 questions

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1.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What is an exchange rate?

The amount of goods one country can trade with another.

The price of one country's currency in terms of another country's currency.

The interest rate set by a country's central bank.

The balance of trade between two countries.

2.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Which of the following is a result of a currency appreciation?

Exports become more expensive for other countries.

Imports become more expensive for domestic consumers.

Foreign goods become cheaper for domestic consumers.

The government reduces interest rates.

3.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What does it mean when a currency 'depreciates'?

The currency loses value compared to another currency.

The currency gains value compared to another currency.

The government sets a fixed rate for the currency.

The currency is no longer in use.

4.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Which of the following is likely to increase demand for a currency?

Lower interest rates in the country.

High inflation in the country.

An increase in foreign investment in the country.

Decreasing exports from the country.

5.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

If Country X's currency appreciates, what is the likely impact on Country X's exports?

Exports will become more competitive.

Exports will become more expensive.

Exports will increase.

Exports will stay the same.

6.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Which of the following could cause a country's currency to depreciate?

Increase in foreign direct investment.

Decrease in imports.

Higher interest rates.

Higher inflation rates.

7.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

If the exchange rate changes from 1 USD = 1.5 CAD to 1 USD = 1.6 CAD, what has happened to the value of the USD?

The USD has depreciated.

The USD has appreciated.

The CAD has appreciated.

The exchange rate has remained the same.

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