8) The price of one currency in terms of another is called A) the terms of trade. C) purchasing power parity B) a currency band D) the exchange rate. 19) -- exchange rates are either held constant or allowed to fluctuate( ) only within very narrow boundaries, A) managed float exchange rate system B) Freely exchange rate system ) pegged exchange rate system D) fixed exchange rate system : ------- Is the replacement (Jap) of a foreign currency with U.S dollars. A) Pegged exchange rate system B) Freely floating exchange rate system C) Dollarization exchange rate system D) Managed float exchange rate system Chat hernative that inflation of rather conten A freely at wh change rate at 2) I had on relationship betwe A) mixed forecasting technical forecasting is based on relationships between cromont variables and exchange rates, Dymarket bad forecasting of onde Mates that the exchange rate is determined by the relative prices of war A) The Fisher Taffect lative purchas e party ) Absolute purchasing power party Of Interest rate perity is an excluange rate quoted today for ment some time in the future A) spot rate 1) currency rate yield curve D) forward 5) If an identical product can be sold in two different markets, and no restrictions exist on the sale of transportation costs, the product's price should be the same in both markets. This is knows A) relative purchasing power parity 3) the law of one price C) equilibrium D) interest rate parity 5) 6) Impirical evidence shows that in the short run, purchasing power party purchasing power party A) does not hold; does not hold B) holds does not hold C) does not hold holds D) holds holds and in the long run, 7) Which of the following is not a method of forecasting exchange rate volatility? A) Using the volatility of historical exchange rate movements as a forecast for the future B) Using the absolute forecast error as a percentage of the realized value to improve your forecast C) Using a time series of volatility patterns in previous periods D) Deriving the exchange rate's implied standard deviation from the currency option pricing model 8) The price of one currency in terms of another is called A) the terms of trade. C) purchasing power parity B) a currency band D) the exchange rate. 9) 9) --------exchange rates are either held constant or allowed to fluctuate only within very narrow boundaries, A) managed float exchange rate system B) Freely exchange rate system ) pegged exchange rate system D) fixed exchange rate system 10) ------- Is the replacement (14) of a foreign currency with U.S dollars. A) Pegged exchange rate system B) Freely floating exchange rate system C) Dollarization exchange rate system D) Managed float exchange rate system
