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WorksheetsForeign Exchange Quiz-2017
Total questions: 10
Worksheet time: 50mins
Name
Class
Date
1.
Will the following scenario affect the current account or capital account, and will the transaction be a debit or credit?
The U.S. increase imports of tractor wheels from Canada.
The U.S. increase imports of tractor wheels from Canada.
a)
current account; debit.
b)
current account; credit.
c)
capital account; debit.
d)
capital account; credit.
2.
Will the following scenario affect the current account or capital account, and will the transaction be a debit or credit?
A Ukrainian businesswoman buys a majority share of ownership in a U.S. clothing company.
A Ukrainian businesswoman buys a majority share of ownership in a U.S. clothing company.
a)
current account; debit.
b)
current account; credit.
c)
capital account; debit.
d)
capital account; credit.
3.
Will the following scenario affect the current account or capital account, and will the transaction be a debit or credit?
An American working in Saudi Arabia sends his wife, who lives in Atlanta, money so she can buy a new car.
An American working in Saudi Arabia sends his wife, who lives in Atlanta, money so she can buy a new car.
a)
current account; debit.
b)
current account; credit.
c)
capital account; debit.
d)
capital account; credit.
4.
Will the following scenario affect the current account or capital account, and will the transaction be a debit or credit?
An American receives quarterly dividend payments (profits) from stock she owns in a German company.
An American receives quarterly dividend payments (profits) from stock she owns in a German company.
a)
current account; debit.
b)
current account; credit.
c)
capital account; debit.
d)
capital account; credit.
5.
An increase in price level in the U.S. relative it its trading partners will cause the U.S. dollar to __________ on the foreign exchange market, and Americans will __________ the purchase of foreign made goods.
a)
appreciate, increase
b)
appreciate, decrease
c)
depreciate, decrease
d)
depreciate, increase
6.
If the interest rate in the U.S. decreases relative to interest rate in Europe, the exchange rate for the U.S. dollar will __________ relative to the euro, the currency of the European Union. However, domestic business investment in the U.S. will __________.
a)
appreciate, decrease
b)
appreciate, increase
c)
depreciate, decrease
d)
depreciate, increase
7.
If Americans want to purchase more South Korean cars, the supply of dollars in the foreign exchange market will __________ and demand for the Won, the South Korean currency, will __________.
a)
increase, decrease
b)
increase, increase
c)
decrease, decrease
d)
decrease, increase
8.
An increase in stock market profits in Europe will cause the dollar to ______________ and the euro, the currency of the European Union, to __________.
a)
depreciate, depreciate
b)
depreciate, appreciate
c)
appreciate, appreciate
d)
appreciate, depreciate
9.
An increase in US deficit spending will cause a(n) __________ in domestic U.S. business investment and a(n) __________ of the U.S. dollar in foreign exchange markets.
a)
increase, appreciation
b)
decrease, depreciation
c)
decrease, appreciation
d)
increase, depreciation
10.
The sale of U.S. treasury bonds on the open market will cause a(n) __________ in the U.S. price level and a(n) __________ of the U.S. dollar in the foreign exchange market.
a)
decrease, appreciation
b)
decrease, depreciation
c)
increase, appreciation
d)
increase, depreciation
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