Given Floating Exchange Rates,assume That the Swiss Decrease Their Import

question 199

Multiple Choice

Given floating exchange rates,assume that the Swiss decrease their import purchases from Italy while at the same time the Italians increase their purchases of Swiss government securities.The first action by itself would lead to a (an) ____ of the franc against the lira while the second action by itself would lead to a (an) ____ of the franc against the lira.

• A) Appreciation,appreciation
• B) Depreciation,depreciation
• C) Appreciation,depreciation
• D) Depreciation,appreciation

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Definitions:

Economic Growth

An increase in the amount of goods and services produced per capita over time, reflecting a growing economy.

Unemployment

The situation where individuals who are capable of working and willing to work are unable to find employment.

Opportunity Cost

The disqualification of possible advantages obtainable from other scenarios when one is embraced.

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Two-wheeled motor vehicles that are often used for transportation, recreation, or sport, known for their maneuverability and speed.