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.

1. foreign; foreign
2. foreign; dollar
3. dollar; foreign
4. dollar; dollar

2. In the short-run FX model, everything else held constant, when the current value of the domestic currency increases, the ________ domestic assets ________.

1. demand for; increases
2. quantity demanded of; increases
3. demand for; decreases
4. quantity 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.

1. right; appreciate
2. right; depreciate
3. left; appreciate
4. left; 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 ________.

1. increase; appreciate
2. decrease; appreciate
3. increase; depreciate
4. decrease; depreciate