You Note That Over the Last Five Years, the Swiss

question 20

Essay

You note that over the last five years, the Swiss franc has appreciated from Sfr 1.60/$1 to Sfr 1.45/$1. During that same period, the U.S. consumer price index rose from 100 to 120 and the Swiss consumer price index rose from 100 to 105. On the basis of these movements, would you expect the Swiss to be buying more or less U.S. goods? Why? Would you advise a foreign exchange speculator to buy Swiss francs at this point or to change Swiss francs into U.S. dollars? Why or why not?

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Definitions:

Low-Fat Diet

A dietary approach that reduces the intake of fat, especially saturated fat and cholesterol, to promote heart health and possibly aid in weight loss.

Control Group

A control group is a group in an experiment that does not receive the experimental treatment, allowing researchers to measure the effect of the treatment by comparison.

Extraneous Variables

Factors other than the independent variable that can affect the outcome of an experiment and need to be controlled.

Experimental Group

The group in an experiment that receives the treatment or intervention under study to investigate its effects.