$1.$The following is an example of a company hedging its foreign currency risk

A$)$ needing to pay $100,000$ yen to its suppliers in a month, it makes a

forward$-$exchange deal to buy yen.

B$)$ expected to receive $100,000$ yen from its importers in a month, it

makes a forward$-$exchange deal to buy yen.

C$)$ needing to pay $100,000$ yen to its suppliers in a month, it sells yen in a

spot$-$exchange deal.

D$)$ expected to receive $100,000$ yen from its importers in a month, it sells

yen in a spot$-$exchange deal.

If the expected future spot exchange rate value of the foreign currency

decreases, with the interest rate differential unchanged, the current spot

exchange$-$rate value of the domestic currency

A$)$ increases

B$)$ decreases

C$)$ remains unchanged

D$)$ overshoots

Everything else fundamentally remaining unchanged, the monetary

approach predicts that a $5$ percent cut in the money supply by the Fed will

result in

A$)$ inflation in the U$.$S$.$ economy.

B$)$ a decrease in the market rate of interest in the United States.

C$)$ an increase in foreign investments by the Americans.

D$)$ an appreciation of the U$.$S$.$ dollar vis$--$vis other currencies.

A deficit in the overall balance of payments of a nation generally is an

indication that

A$)$ the country's monetary authority is buying foreign currency.

B$)$ the country's monetary authority is selling foreign currency.

C$)$ the country's monetary authority is buying domestic government

bonds.

D$)$ the country's monetary authority is selling domestic government

bonds.