Question 1

If the U.S.real exchange rate appreciates,U.S.exports to Europe

Accepted Answer

The answer of If the U.S.real exchange rate appreciates,U.S.exports to...

Question 2

Suppose that the real exchange rate between the United States and Kenya is defined in terms of baskets of goods.Other things the same,which of the following will increase the real exchange rate?

Accepted Answer

A decrease in the price of Kenyan goods means that a dollar can now buy more Kenyan goods than before, leading to an increase in the purchasing power of the dollar. This, in turn, leads to an increase in the real exchange rate between the US and Kenya, as more Kenyan goods can be purchased with the same amount of dollars.

Question 3

If the real exchange rate is 5/4 pounds of Chilean beef per pound of U.S.beef,a pound of U.S.beef costs $2 and the nominal exchange rate is 500 Chilean pesos per dollar,then Chilean beef costs

Accepted Answer

If a pound of U.S. beef costs $2, then it costs 2 * 500 = 1000 Chilean pesos. 
The real exchange rate is 5/4 pounds of Chilean beef per pound of U.S. beef, so one pound of Chilean beef costs (4/5) * 1000 = 800 Chilean pesos. 
Therefore, the answer is B, 800 pesos per pound.

Question 4

When the yen gets "stronger" relative to the dollar,

Accepted Answer

When the yen gets stronger relative to the dollar, it means that it takes fewer yen to buy one dollar. This makes Japanese goods more expensive for American buyers, which leads to a decrease in imports from Japan, and accordingly, a decrease in the U.S. trade deficit with Japan.

Question 5

A depreciation of the U.S.real exchange rate induces U.S.consumers to buy

Accepted Answer

A depreciation of the U.S. real exchange rate makes foreign goods more expensive relative to domestic goods, leading U.S. consumers to buy more domestic goods and fewer foreign goods.

Question 6

Which of the following could be a consequence of a depreciation of the U.S.real exchange rate?

Accepted Answer

The answer of Which of the following could be a...

Question 7

If US goods cost one dollar for each euro German goods costs,the real exchange rate would be computed as how many German goods per U.S.goods?

Accepted Answer

The answer of If US goods cost one dollar for...

Question 8

If the real exchange rate for coal is 1.5,the price of coal in the U.S.is $50 per ton,and the price of coal in Britain is 20 British pounds per ton,what is the nominal exchange rate?

Accepted Answer

The answer of If the real exchange rate for coal...

Question 9

If it took as many dollars to buy goods in the United States as it did to buy enough currency to buy the same goods in India,the real exchange rate would be computed as how many Indian goods per U.S.goods?

Accepted Answer

The answer of If it took as many dollars to...

Question 10

Other things the same,if the U.S.real exchange rate appreciates,U.S.net exports

Accepted Answer

The answer of Other things the same,if the U.S.real exchange...

Question 11

Suppose that the real exchange rate between the United States and Vietnam is defined in terms of baskets of goods.Other things the same,which of the following will increase the real exchange rate (that is increase the number of baskets of Vietnamese goods a basket of U.S.goods buys)?

Accepted Answer

The answer of Suppose that the real exchange rate between...

Question 12

If US goods cost 1/5 of one dollar for every kroner Danish goods cost,the real exchange rate would be computed as how many Danish goods per U.S.goods?

Accepted Answer

The answer of If US goods cost 1/5 of one...

Question 13

If the number of Japanese yen a dollar buys falls,but neither country's price level changes,then the real exchange rate

Accepted Answer

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Question 14

An appreciation of the U.S.real exchange rate induces U.S.consumers to buy

Accepted Answer

An appreciation of the U.S. real exchange rate makes foreign goods relatively cheaper and domestic goods relatively more expensive, leading U.S. consumers to purchase fewer domestic goods and more foreign goods.

Question 15

If the U.S.real exchange rate appreciates,U.S.exports

Accepted Answer

The answer of If the U.S.real exchange rate appreciates,U.S.exports
...

Question 16

Suppose that the nominal exchange rate is 80 yen per dollar,that the price of a basket of goods in the U.S.is $500 and the price of a basket of goods in Japan is 50,000 yen.Suppose that these values change to 100 yen per dollar,$600,and 70,000 yen.Then the real exchange rate would

Accepted Answer

The answer of Suppose that the nominal exchange rate is...

Question 17

Suppose the real exchange rate is 1/2 gallon of Canadian gasoline per gallon of U.S.gasoline,a gallon of U.S.gasoline costs $5.00 U.S. ,and a gallon of Canadian gas costs 8 Canadian dollars.What is the nominal exchange rate?

Accepted Answer

The answer of Suppose the real exchange rate is 1/2...

Question 18

Consider an identical basket of goods in both the U.S.and India.For a given nominal exchange rate,in which case is it certain that the U.S.real exchange rate with India falls?

Accepted Answer

If the price of the basket of goods falls in the U.S. and rises in India, then the U.S. real exchange rate with India falls. This is because a given amount of U.S. dollars can now buy fewer Indian goods, indicating that the U.S. dollar has lost value relative to the Indian rupee.

Question 19

Suppose that the real exchange rate between the United States and Kenya is defined in terms of baskets of goods.Other things the same,which of the following will increase the real exchange rate (that is increase the number of baskets of Kenyan goods a basket of U.S.goods buys)?

Accepted Answer