Exam 2: International Monetary System

A) (iii) , (i) , (iv) , (ii) , and (v)
B) (i) , (iii) , (v) , (ii) , and (iv)
C) (vi) , (i) , (iii) , (ii) , and (v)
D) (v) , (ii) , (i) , (iii) , and (iv)

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A) fixed exchange rates were declared unacceptable to the IMF members
B) pegged exchange rates were declared unacceptable to the IMF members
C) flexible exchange rates were declared acceptable to the IMF members
D) mixed exchange rates were declared acceptable to the IMF members

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A) To define and implement the common monetary policy of the EU
B) To define and implement the common fiscal policy of the EU
C) To conduct foreign exchange operations
D) To hold and manage the official foreign exchange reserves of the euro member states

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A country can attain only two of these t...

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A) is an example of a fixed exchange rate regime
B) is an example of a flexible exchange rate regime
C) gave birth to the introduction of the Euro
D) was used to smooth transition from bimetallism to the classical gold standard

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A) all EU countries adopted a common currency called the euro.
B) eight of 15 EU countries adopted a common currency called the euro.
C) nine of 15 EU countries adopted a common currency called the euro.
D) eleven of 15 EU countries adopted a common currency called the euro.

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A) The United States has a larger population than the Euro-17.
B) The United States has a larger GDP than the Euro-17.
C) Euro -17 has a larger share of World Trade than the United States.
D) Euro -17 has less international bonds outstanding than the United States.

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Exchange FF to £ at current exchange rat...

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A) Central banks of these courtiers are required to maintain exchange reserves to cover 100% of the existing domestic currency
B) Centrals banks cannot use monetary policy to affect the economic fundamentals (such as inflation)
C) These countries must use currency board
D) The external value of the country's currency will simply depreciate to the level at which there is no excess supply of the country's currency

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A) £55.56
B) £65.56
C) £75.56
D) £85.56

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A

A) used to make international payments to non-member of the International Monetary Fund (IMF) .
B) a "portfolio" of currencies, and its value tends to be more instable than the currencies that it is comprised of.
C) used in addition to gold and foreign exchanges, to make domestic payments.
D) a basket currency comprising major individual currencies allotted to the members of the IMF, who could then use SDRs for transactions among themselves or with IMF.

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A) To establish a "zone of monetary stability" in Europe
B) To coordinate exchange rate policies vis-à-vis the non EMS currencies
C) To pave the way for the eventual European monetary union
D) To pave away from the European monetary union

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A) WTO
B) World Bank
C) IMF
D) NAFTA

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C

A) $0.25/£
B) $0.33/£
C) $1/£
D) $3/£

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A) FF0.0667/$
B) FF14.9976/$
C) FF6407.7/$
D) $6407.7/FF

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A) there was an explicit set of rules about the conduct of international trade policies
B) each country was responsible for maintaining its exchange rate within 2.50 percent of the adopted par value by buying or selling foreign exchanges as necessary
C) the U.K. sterling pound was the only currency that was fully convertible to gold
D) each country established a par value in relation to the U.S. dollar, which was pegged to gold at $35 per ounce.

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A) Bimetallism
B) Classical Gold Standard
C) Bretton Woods System
D) Flexible exchange rate regime

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