True
Explanation: When the yen/$ exchange rate falls,
it means $1 can now buy less number of yen i.e. 1 yen can buy more
number of dollars. So, US goods are now less expensive for Japanse
firms.
Question 7 0.13 pts Suppose that the exchange rate (yen/$) between Japan and the U.S. goes...
15. If the real exchange rate between the U.S. and Japan is 1, the nominal exchange rate is 100 yen per U.S. dollar and the price of copper in the U.S. is $2.50 per pound of copper, what is the price of copper in Japan? A. 400 yen per pound of copper B. 250 yen per pound of copper C. 100 yen per pound of copper D. 40 yen per pound of copper E. 25 yen per pound of copper...
The diagram shows the market equilibrium exchange rate between the Japanese yen and the U.S. dollar (USD). Suppose that capital flows from the United States to Japan increase. Shift the demand and supply curves as appropriate. Quantity of yen This change in the exchange rate will result in the balances of payments on Japan's current account and financial account rising. o the balance of payments on Japan's current account falling as the balance of payments on Japan's financial This change...
Assume that uncovered interest rate parity holds between the Japanese yen and the U.S. dollar. If today the 1-year riskless interest rate in Japan is 5%, the one-year riskless interest rate in the U.S. is 1%, and the spot exchange rate is $.01 per yen, what is the expected exchange rate one-year from today? Suppose that expected inflation in the U.S. increased. What would happen to the current (spot) exchange, i.e. will it increase or decrease? Explain your reasoning.
For the first three questions consider the U.S.- Japan exchange rate, expressed as yen per dollar. Using the basic supply and demand diagram as illustrated at the beginning of Week 9 lecture slides, answer the following: 1. Other things being equal, an increase in the Japanese price level will shift the supply curve of dollars_________, the demand curve for dollars__________ and cause the dollar to ________. a. rightward, leftward, depreciate b. leftward, rightward, depreciate c. leftward, rightward, appreciate d. rightward,...
9. Suppose nominal exchange rates are 110 Japanese yen per dollar, 0.9 euro per dollar, and 16 Mexican pesos per dollar. A pizza costs 1,600 yen in Tokyo, Japan, 12 euro in Munich, Germany, 180 pesos in Mexico City and 12 dollars in Raleigh, North Carolina. Which of the following statements is (are) correct? (x) Pizza is more expensive in Tokyo than Mexico City but less expensive than in Munich. (y) Pizza is less expensive in Raleigh than Munich but...
Question 19 (2.5 points) Suppose the exchange rate between yen and dollars is currently set at 125 yen per dollar. If Japanese in Valdosta, GA purchased a commodity that sells for $250, this would cost the equivalent of 31,250 yen 2 yen 312.5 yen 200 yen Question 24 (2.5 points) Suppose that Austria and Belgium have the labor hours requirements for producing steel and brooms shown in the table at the below. Then Austria Belgium Labor Hours per output 1...
DQuestion 36 2 pts The following table shows the number of U.S. dollars required to buy one British pound and the number of U.S. dollars required to buy one euro between February 1, 2016, and September 1, 2016: U.S. Dollars Required U.S. Dollars to Buy 1 British Pound 1.429 Required to Buy 1 Euro 1.1092 Date February 1, 2016 March 1, 2016 1.425 April 1, 2016 1.432 May 1, 20161.452 June 1, 2016 1.420 July 1, 20161.313 August 1, 2016...
QUESTION 25 Let the U.S. dollar-yen spot rate be ¥120/$. Also, let the 180-day forward exchange rate be ¥124.8/$. Then the yen is selling at a per annum _________ of ___________. a. premium; 8.00% b. premium; 6.30% c. discount; 8.00% d. discount; 1.57% QUESTION 26 Assume that a green card holder flies with American Airlines from NYC to Paris. The related transactions will be reported on the Balance of Payments. True False
Question 11 2.5 pts Mambo and Rumba are economies of similar sizes. Mambo's growth rate is 3 percent whereas Rumba is growing at a rate of 7 percent. The marginal propensity to import is the same positive value for both economies. We would depreciating. The new exchange rate will expect to see the currency of Mambo's consumers. Rumba; hurt Rumba; benefit Mambo; hurt Mambo; benefit Question 12 2.5 pts The foreign exchange market is in equilibrium, with each British pound...
Suppose that you go on vacation to Canada every summer. Last year, the hotel room where you stayed cost C$100 per night, and it costs the same this year. The exchange rate was 1.04 USS/C$ last year, and it is 0.95 US$/C$ this year. This means you will pay than you paid last year. per night this year The U.S. dollar-Canadian dollar exchange rate is essentially the price of a Canadian dollar in terms of U.S. dollars. When this price...