Given a System of Floating Exchange Rates, Assume That Boeing

question 124

Multiple Choice

Given a system of floating exchange rates, assume that Boeing Inc.of the United States places a large order, payable in yen, with a Japanese contractor for jet engine parts.The immediate effect of this transaction will be a shift in the

• A) supply curve of yen to the left, which causes the dollar to appreciate against the yen.
• B) supply curve of yen to the right, which causes the dollar to depreciate against the yen.
• C) demand curve for yen to the left, which causes the dollar to appreciate against the yen.
• D) demand curve for yen to the right, which causes the dollar to depreciate against the yen.

---

Definitions:

MR (Marginal Revenue)

The increment in revenue that results from the sale of one additional unit of a product or service.

Peak Efficiency

The highest level of performance or effectiveness that a process, machine, or organization can achieve.

ATC (Average Total Cost)

The per unit cost of production, calculated by dividing the total cost by the quantity of output produced.

MC (Marginal Cost)

The additional expense associated with the production of one more unit of a product or service.