Under a System of Floating Exchange Rates, a Japanese Trade

question 130

Multiple Choice

Under a system of floating exchange rates, a Japanese trade surplus against Canada would result in a(n)

• A) rise in the dollar price of the yen.
• B) fall in the dollar price of the yen.
• C) rise in the yen price of the dollar.
• D) unchanged dollar/yen exchange rate.

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Definitions:

Title

The legal right to own or possess something, such as property or a title to a vehicle, representing ownership and legal possession.

Normal Balances

The side (debit or credit) of an account that is expected to increase, consistent with the principles of double-entry bookkeeping.

Assets

Economic resources owned or controlled by a business or individual, capable of producing value.

Liabilities

Financial obligations or debts owed by a business to external parties or entities.