If the United States decided to fix its exchange rate with Japan, this would Multiple Choice...

Question

Question

If the United States decided to fix its exchange rate with Japan, this would

Multiple Choice

require the U.S. to fix its exchange rate with all other currencies.

ensure that the U.S. dollar would always appreciate against the yen.

prevent the U.S. from having a trade deficit with Japan.

cause the U.S. government to become the dollar-yen foreign exchange market.

Answer 1

Answer #1

The correct answer is:d)

Reason: Under a fixed exchange rate, the U.S. government needs to intervene in the forex market to maintain the fixed exchange rate.

Thanks!

Answer 2

Similar Homework Help Questions

Assume that Japan and the United States are engaged in the United States for their vacations,...

Assume that Japan and the United States are engaged in the United States for their vacations, a system of flexible exchange rates. If more Japanese tourists decide to visit Multiple Choice the yen will depreciate and the U.S. dollar will appreciate. the yen will appreciate and the U.S. dollar will depreciate the yen and the U.S dollar will appreciate the yen and the U.S. dollar will depreciate < Prev 46 of 48Hİ Next > C A Dy L M Quantity...
We start with a 3 percent real interest rate in the United States and in Japan....

We start with a 3 percent real interest rate in the United States and in Japan. Next, the real interest rate in Japan falls to 2 percent, and the U.S. real interest remains constant. As a result, A. the yen will appreciate, and the dollar will depreciate. B. both the yen and the dollar will appreciate. C. the yen will depreciate, and the dollar will appreciate. D. both the yen and the dollar will depreciate.
The United States government is currently running a budget deficit. What would the USA and the...

The United States government is currently running a budget deficit. What would the USA and the Foreign Exchange Market's SHORT-RUN impact be on (a) the interest rate for dollar-denominated deposits (i$), (b) output in the US economy, and (c) the dollar-euro exchange rate against all foreign currencies (E$/F).

A car costs $20,000 in the United States and 2.500,000 yen in Japan. The exchange rate...

A car costs $20,000 in the United States and 2.500,000 yen in Japan. The exchange rate is $1 103 yen. The purchasing power parity of the dollar is yen. (Ente your response as a whole number)
1a. In the foreign exchange market, a decrease in the world demand for Japanese exports a....

1a. In the foreign exchange market, a decrease in the world demand for Japanese exports a. shifts the demand curve for yen leftward, which causes the yen to appreciate. b. shifts the demand curve for yen rightward, which causes the yen to appreciate. c. shifts the demand curve for yen rightward, which causes the yen to depreciate. d. shifts the demand curve for yen leftward, which causes the yen to depreciate. 1b. A relatively high rate of inflation in the...
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,...

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...

answer these 4 . will rate after A reduction in the British interest rate relative to...

answer these 4 . will rate after A reduction in the British interest rate relative to the U.S. interest rate will cause a(n): appreciation of the dollar and an appreciation of the British pound. O appreciation of the dollar and a depreciation of the British pound. depreciation of the dollar and an appreciation of the British pound. O depreciation of the dollar and a depreciation of the British pound. A decrease in preference for Japanese automobiles, all else the same,...
Please answer in an 'A,B,C,D' format where A would be the first answer and D would...

Please answer in an 'A,B,C,D' format where A would be the first answer and D would be the last. Thank you. QUESTION 22 Suppose that $1 U.S. costs $1.50 Canadian. If in St. Louis a CD costs $10 U.S. and in Montreal it costs $15 Canadian, then _____ Canadians will buy CDs in St. Louis Virgin Records will have an incentive to build more stores in North America Americans will buy CDs in Montreal o purchasing power parity exists QUESTION...
A car costs $25,000 in the United States and 3,000,000 yen in Japan. The exchange rate is $1 = 100 yen. The purchasing...

A car costs $25,000 in the United States and 3,000,000 yen in Japan. The exchange rate is $1 = 100 yen. The purchasing power parity of the dollar isyen. (Enter your response as a whole number.)

Assume that the exchange rate between the United States and Japan is equal to 0.0086 $/yen....

Assume that the exchange rate between the United States and Japan is equal to 0.0086 $/yen. Pound of Tomatoes Pound of Carrots Pound of Cucumbers Pound of Green Beans Price in the United States $3.29 $3.50 $7.54 Price in Japan 382.72 yen 270.00 yen 876.74 yen $2.50 200.00 yen Round prices to two decimal places. In which of the markets below does purchasing power parity (PPP) hold? In the market of tomatoes. In the market of carrots. In the market...