How does the government’s decision to run a budget surplus affect the market for foreign-currency exchange?
John asked:
Assuming the world interest rate remains the same at 3%, the increase in the budget surplus will lead to:
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Assuming the world interest rate remains the same at 3%, the increase in the budget surplus will lead to:
I. An increase in the demand for dollars
II. An increase in the supply of dollars
III. An increase in the quantity of net exports
IV. Appreciation of the dollar
A. I and IV only
B. I, II, III, and IV
C. II, III, and IV only
D. II and III only
April 18th, 2010 at 8:35 pm
The answer is “A. I and IV only” Umer Nasim
April 21st, 2010 at 11:22 am
“II” is false, so B,C and D are false too.
A. I and IV only - this is right answer. Jurij-EU