Quote:
Originally Posted by lezhek
1) lower interest
2) raze interest
3) more foreign investors
4) less foreign investors
5) deficit grows, currency depreciates
6) more money in current account, currency appreciates
7) currency appreciates
8) CAD currency appreciates
9) US economy is supported by consumer spending
10) service based
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Hi Lezhek,
Thanks for the reply and for participating in the quiz. It seems that you are picking things up nicely as well.
1. Correct Answer - decrease in rates expected to try and spur growth
2. Correct - increase in rates expected to reign in inflation
3. Almost Correct - You are correct that this should increase foreign capital flows however the affect of this is the answer that I am looking for here which is that the currency should strengthen as more foreign capital flows in.
4. Almost Correct - You are correct that this should decrease foreign capital flows however the affect of this is the answer that I am looking for here which is that the currency should weaken as more capital flows out.
5. Almost Correct - You are correct that the currency should weaken and that the current account will decrease in size however it does not have to be in deficit it can simply become less positive.
6. Correct - currency should strengthen and the current account should increase
7. Correct - the value of their currency should rise
8. Half Correct - The CAD will strengthen however the JPY will also weaken which should send the rate for the CAD/JPY higher.
9. Correct - over 2/3rds of the US Economy is consumer spending.
10. Correct - The US Has a Service Based Economy.
Thanks again for participating I think you are ready to move forward as well.
Best Regards,
Dave