1. In the short-run FX model, as the relative expected return on… 1. In the short-run FX model, as the relative expected return on dollar

1. In the short-run FX model, as the relative expected return on… 1. In the short-run FX model, as the relative expected return on dollar assets increases, foreigners will want to hold more ________ assets and less ________ assets, everything else held constant.foreign; foreignforeign; dollardollar; foreigndollar; dollar 2. In the short-run FX model, everything else held constant, when the current value of the domestic currency increases, the ________ domestic assets ________.demand for; increasesquantity demanded of; increasesdemand for; decreasesquantity demanded of; decreases 3. In the short-run FX model, an increase in the domestic interest rate causes the demand for domestic assets to shift to the ________ and the domestic currency to ________, everything else held constant.right; appreciateright; depreciateleft; appreciateleft; depreciate 4. Suppose that the Federal Reserve enacts expansionary policy. Everything else held constant, this will cause the demand for U.S. assets to ________ and the U.S. dollar to ________.increase; appreciatedecrease; appreciateincrease; depreciatedecrease; depreciate 5. In the short-run FX model, an increase in the expected future domestic exchange rate causes the demand for domestic assets to ________ and the domestic currency to ________, everything else held constant.increase; appreciateincrease; depreciatedecrease; appreciatedecrease; depreciate 6. When the effects of the global financial crisis started to spread more quickly throughout the rest of the world, the U.S. dollar ________ because demand for U.S. assets ________.appreciated; increaseddepreciated; increasedappreciated; decreaseddepreciated; decreased 7. The Brexit vote in June 2016 resulted in higher expected trade barriers . Therefore, the expected value of the pound would be ________ in the future. The result was the sharp ________ in the equilibrium exchange rate for the British pound.lower; fall lower; risehigher; fallhigher; rise 8. If the interest rate is 7 percent on euro-denominated assets and 5 percent on dollar-denominated assets, and if the dollar is expected to appreciate at a 4 percent rate, for Francois the expected rate of return on dollar-denominated assets is11 percent.9 percent.5 percent.3 percent. 9. The nominal exchange rate is 30 Thai baht for one U.S. dollar. A sub sandwich combo deal in the U.S. costs $6 dollars in the U.S. and 120 baht in Thailand. The real exchange rate is              a.           3/8              b.           2/3              c.           3/2              d.           8/3              10. A basket of goods costs $800 in the U.S. In Belgium the basket of goods costs 640 euros and the exchange rate is .80 euros per U.S. dollar. In Japan the basket of goods costs 90,000 yen and the exchange rate is 90 yen per dollar. Which country has purchasing-power parity with the U.S.?              a.           both Belgium and Japan              b.           Belgium but not Japan              c.           Japan but not Belgium              d.           neither Belgium nor Japan Business Economics Macroeconomics DSME 5012F Share QuestionEmailCopy link