Suppose, for Whatever Reason, Real Interest Rates in the United

question 41

Multiple Choice

Suppose, for whatever reason, real interest rates in the United States are projected to grow and real interest rates in Europe are projected to remain flat and suppose that before this happens the exchange rate between the euro and the dollar is .75 euros/dollar. The resulting exchange rate would likely

• A)rise to (perhaps).9 euros/dollar.
• B)fall to (perhaps).6 euros/dollar.
• C)cause the exchange rate to have to be expressed in dollars per euro (because the other way would no longer make sense).
• D)remain unchanged.

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Officially recorded or enrolled in a list or database by a recognized authority.

Seize

To take possession of something forcefully or by legal authority.

Landowner

An individual or entity that holds legal title to a piece of land or property.

Bricklayer

A skilled tradesperson who lays bricks to construct brickwork.