1. Under the gold standard a) all international transactions must be paid by gold b) imports and exports of gold among nations are prohibited c) a country must define its currency unit by a fixed gold content d) the British pound sterling was useless. Answer: 2. The Bretton Woods system fell apart because a) of the oil crisis b) U.S, monetary policy was too expansionary c) the United States ran a large trade deficit d) b and c e) none of the above Answer: 3. The current exchange rate system can best be characterized as a a) free float b) target-zone arrangement c) fixed-rate system d) hybrid (mixed) system d) managed float Answer: 4. Which one of the following is a demander (buyer) of British pounds ( f ) in the f-USS market? a) British exporter of oil to the U.S. b) Importer of U.S. computers to Britain c) U.S. investor in British securities d) British investor in U.S. securities e) a and c above Answer: 5. Which one of the following is a supplier (seller) of Canadian dollars in the CS-USS market? a) Canadian importer of U.S. computers b) U.S. importer of Canadian lumber c) U.S. investors in Canadian securities d) Canadian exporter of car parts to the U.S. Answer: 6. American terms of exchange rate refers to the a) number of U.S. dollars per unit of a foreign currency b) number of foreign currency units per U.S, dollar c) quotation system found in the United States d) bid-ask spread on the U.S, dollar c) none of the above