Question : A decrease in a country's exports is likely to result in:

Option 1: Appreciation of its currency
 

Option 2: Depreciation of its currency
 

Option 3: No impact on its currency

Option 4: A fixed exchange rate

Question : Which of the following is a potential benefit of currency appreciation for an import-dependent economy?

Option 1: Lower import costs.
  

Option 2: Increased competitiveness of domestic industries.
 

Option 3: Expansion of export markets.

Option 4: All of the above.

Question : Currency appreciation can negatively impact a country's ________, as it makes the country's exports more expensive.

Option 1: trade balance
 

Option 2: foreign investment
 

Option 3: inflation rate

Option 4: unemployment rate

Question : A country with a trade surplus is likely to experience:

Option 1: Appreciation of its currency
 

Option 2: Depreciation of its currency
 

Option 3: No impact on its currency

Option 4: A fixed exchange rate

Question : What is the term used to describe a situation where a country's central bank fixes the value of its currency to another currency at a specified exchange rate?

Option 1: Currency intervention
  

Option 2: Currency hedging
 

Option 3: Currency manipulation

Option 4: Currency pegging