If the US government imposes an import quota on French wine, US net exports will ()
A. increase, the real exchange rate of the dollar will appreciate, and domestic sales of US wine will increase.
B. not change, the real exchange rate of the dollar will appreciate, and domestic sales of US wine will increase.
C. not change, the dollar will depreciate, and domestic sales of US wine will not change.
D. None of the above is correct.
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Suppose that the government of Jordan raises its budget deficit. The real exchange rate of the Jordanian dinar ()
A. depreciates and Jordanian net exports would rise.
B. depreciates and Jordanian net exports would fall.
C. appreciates and Jordanian net exports rise.
D. appreciates and Jordanian net exports fall.
Suppose the same basket of goods costs $100 in the US and 50 pounds in Britain. According to purchasing power parity, what is the nominal exchange rate? ()
A. 2 pounds per dollar
B. 1 pound per dollar
C. 1/2 pound per dollar
D. None of the above is correct
At a given real exchange rate, which of the following, by itself, would increase the supply of dollars in the market for foreign-currency exchange? ()
A. foreign citizens buy more US bonds
B. US citizens buy more foreign bonds
C. foreign citizens buy more US goods
D. US citizens buy more foreign goods
In the open-economy macroeconomic model, equilibrium is determined by the equality between the supply of dollars which comes from ()
A. US national saving and the demand for dollars for US net exports.
B. US net capital outflow and the demand for dollars for US net exports.
C. domestic investment and the demand for US net exports.
D. foreign demand for US goods and US demand for foreign goods.
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