Term
| Which of the following statements is true concerning intervention in currency markets? |
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Definition
| Often, a number of countries intervene in currency markets, sometimes in a coordinated way. |
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Term
| Exchange rate changes affect which of the following business decisions? |
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Definition
| Marketing, financila, and production |
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Term
| The ______flexibility a country's exchange rate arrangement, the _____ there will be a thriving black market. |
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Definition
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Term
| A ______currency is when countries lock the value of their currency onto another currency and allow the currency to vary by plus or minus 1 percent against that value. |
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Definition
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Term
| A(N)_____forecaster would use trends in economic variables to predict future exchange. |
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Definition
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Term
| In many countries that rigidly control their currencies, a black market parallels the ____ market and is aligned ___ closely with the forces of supply and demand than is the official market. |
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Definition
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Term
| The International Fisher Effect_____ |
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Definition
| links interest rates and exchange rates |
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Term
Other key factors affecting exchange rate movements can include____
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Definition
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Term
| Examining market views and expectations of the political environment when forecasting exchange rate is an example of examining which types of factors? |
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Definition
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Term
| Studying the cyclical nature of growth and employment as a part of the process to forecast exchange rates is an example of _____ |
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Definition
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Term
| When managers use past trends in exchange rate movements to spot future trends, this is called _____ forecasting |
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Definition
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Term
| This type of exchange rate is adjusted periodically at a fixed pronounced rate response to changes in selective quatitative indicators. |
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Definition
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Term
| The value of the SDR is based on ____ |
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Definition
| the weighted average of five currencies |
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Term
| Forecasting includes predicting the magnitude, timing, and ____ of an exchange rate change or movement |
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Definition
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Term
| Exchange rates can affect financial decisions in which of the following ways? |
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Definition
| a company would want to convert local currency into its home country currency when exchange rates are most favorable |
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Term
| If economic policies do not work, a country may be forced to _____ |
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Definition
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Term
| The International Fisher Effect implies that ____ |
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Definition
| the currency of the country with the lower interest rate will strenthen in the future |
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Term
| Which of the following is one of the IMF's major objectives? |
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Definition
| to make its resources available to its members who are experiencing balance-of-payments difficulties |
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Term
| The Federal Reserve Bank of the New York_____ |
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Definition
| acts as the primary contact with other foreign central banks |
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Term
| When forecasting exchange rates, forecasters must predict the ___ of the change or movement in exchange rates. |
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Definition
| magnitude, timing, and direction. |
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