Question 1

The real exchange rate depends on the nominal exchange rate and on the price difference between two countries measured in the local currencies.

Accepted Answer

A) True 
 B)False

Question 2

If the law of one price holds, and a tonne of rice costs $25 in Australia and 4000 yen in Japan, then the nominal exchange rate is:

Accepted Answer

A)   160 yen/$ and $.10/ yen
B)   1000 yen/$ and $1.00/ yen
C)   400 yen/$ and $.25/ yen
D)   160 yen/$ and $.01/ yenE) B) and C)
F) A) and D)

Question 3

Saving in the Australian economy shows up as investment in the Australian economy or as the Australian net foreign investment.

Accepted Answer

A) True 
 B)False

Question 4

International trade has been much more significant for Australia than for many other nations.

Accepted Answer

A) True 
 B)False

Question 5

Factors that might influence a country's exports, imports and net exports include the cost of transporting goods from country to country, and government international trade policies.

Accepted Answer

A) True 
 B)False

Question 6

If each country specialises in producing goods and services in which it has a comparative advantage, international trade:

Accepted Answer

A)   can raise the standard of living in all trading countries
B)   lowers the standard of living in all trading countries
C)   leaves the standard of living unchanged
D)   increases the political power of the trading countriesE) A) and C)
F) None of the above

Question 7

The real exchange rate is the:

Accepted Answer

A)   domestic price of goods
B)   value of net exports
C)   rate at which a person can trade the currency of one country for the currency of another
D)   rate at which domestic goods are traded for foreign goodsE) B) and D)
F) A) and D)

Question 8

Which of the following statements about the current account and the capital account is correct?

Accepted Answer

A)   The value of goods or services exported equals the value of the asset given up to pay for this import
B)   The net value of the goods or services sold by a country and the net income it earns from overseas must equal the net value of the asset acquired
C)   The international flow of goods and services and income, and the international flow of capital are two sides of the same coin
D)   None of the aboveE) A) and B)
F) None of the above

Exam 31: Open-Economy Macroeconomics: Basic Concepts

If the law of one price holds, and a tonne of rice costs $25 in Australia and 4000 yen in Japan, then the nominal exchange rate is:

Correct Answer
verified

Which of the following statements about the current account and the capital account is correct?

Correct Answer
verified

International trade has been much more significant for Australia than for many other nations.

Correct Answer
verified

Factors that might influence a country's exports, imports and net exports include the cost of transporting goods from country to country, and government international trade policies.

Correct Answer
verified

If each country specialises in producing goods and services in which it has a comparative advantage, international trade:

Correct Answer
verified

The real exchange rate depends on the nominal exchange rate and on the price difference between two countries measured in the local currencies.

Correct Answer
verified

Saving in the Australian economy shows up as investment in the Australian economy or as the Australian net foreign investment.

Correct Answer
verified

The real exchange rate is the:

Correct Answer
verified

Exam 31: Open-Economy Macroeconomics: Basic Concepts

If the law of one price holds, and a tonne of rice costs $25 in Australia and 4000 yen in Japan, then the nominal exchange rate is:

Correct AnswerverifiedShow Answer

Which of the following statements about the current account and the capital account is correct?

Correct AnswerverifiedShow Answer

International trade has been much more significant for Australia than for many other nations.

Correct AnswerverifiedShow Answer

Factors that might influence a country's exports, imports and net exports include the cost of transporting goods from country to country, and government international trade policies.

Correct AnswerverifiedShow Answer

If each country specialises in producing goods and services in which it has a comparative advantage, international trade:

Correct AnswerverifiedShow Answer

The real exchange rate depends on the nominal exchange rate and on the price difference between two countries measured in the local currencies.

Correct AnswerverifiedShow Answer

Saving in the Australian economy shows up as investment in the Australian economy or as the Australian net foreign investment.

Correct AnswerverifiedShow Answer

The real exchange rate is the:

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
verified

Correct Answer
verified

Correct Answer
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