In the Open-Economy Macroeconomic Model,the Quantity of Dollars Demanded in the Market

question 108

Multiple Choice

In the open-economy macroeconomic model,the quantity of dollars demanded in the market for foreign-currency exchange

• A)depends on the real exchange rate.The quantity of dollars supplied in the foreign-exchange market depends on the real interest rate.
• B)depends on the real interest rate.The quantity of dollars supplied in the foreign-exchange market depends on the real exchange rate.
• C)and the quantity of dollars supplied in the market for foreign-currency exchange depend on the real exchange rate.
• D)and the quantity of dollars supplied in the market for foreign-currency exchange depend on the real interest rate.

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Definitions:

Price Ceiling

A legally established maximum price for a good or service, aimed at preventing prices from rising too high.

Crude Oil

A natural petroleum product that's extracted from the earth, unrefined, and used as a primary feedstock for fuel and various chemical productions.

OPEC

The Organization of the Petroleum Exporting Countries, an intergovernmental organization aimed at coordinating and unifying petroleum policies among its member countries.

Bottled Water

Bottled water is drinking water packaged in plastic or glass bottles, and it may or may not be carbonated.