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Question 4 (a) If Malaysia experiences a decline in economic growth (and experiences a decline in inflation and nominal interest rates as a result), what
Question 4 (a) If Malaysia experiences a decline in economic growth (and experiences a decline in inflation and nominal interest rates as a result), what would the probable impact on its currency be when it is compared with the U.S. dollar, and why? (5 marks) (b) Suppose you want to buy a German car, which costs 55,000. What will be price of this car in the United States if the exchange rate is 0.90 per U.S. dollar? What will happen to the price if the exchange rate increases to 0.95 per U.S. dollar? (10 marks) (c) Describe the relationship between interest rates and investment decisions. (5 marks) (d) ROA and ROE are considered as the performance evaluation tools for banks. Do they always move in the same direction? How does an increase in capital affect them
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