A. depreciate
B. not be affected
C. fluctuate more than if it were at peace
D. appreciate
Macroeconomic Issues and Analysis
If Pakistan’s incomes rise faster than those in most other countries the the exchange value will tend to ?
A. fluctuate more than it would do otherwise
B. appreciate
C. depreciate
D. not be affected
If a large car importer in the Pakistan wants to import many cars, then the exchange value of the Pak rupees will tend to ?
A. fluctuate more than it would do otherwise
B. appreciate
C. depreciate
D. not be affected
If the economy is at the peak of the business cycle, aggregate demand …. unemployment ……. inflation ……. and the current account of the balance of payments is likely to move towards …….?
A. rise; falls; rise; deficit
B. falls; rises; falls; surplus
C. falls; falls; falls; surplus
D. is static; low; rises; deficit
If the economy is in the though phase of the business cycle, aggregate demand …. unemployment …… inflation …… and the current account of the balance of payments is likely to move towards ……..?
A. falls; falls; falls; surplus
B. falls; rises; falls; surplus
C. is static; low; rises; deficit
D. rises; falls; rises; deficit
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
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
Starting from a position of internal and external balance a reduction in aggregate demand will cause a current account ?
A. deficit
B. surplus
C. revaluation
D. devaluation
Within the circular flow of income, an increase in domestic income will tend to increase ?
A. exports
B. taxes
C. inventories
D. imports
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