Correct

Privatization is often seen as a cure for bureaucratic inefficiency and waste; some economists estimate that privatization improves efficiency and reduces operating costs by as much as

Question 2

3 out of 3 points

Correct

Since the end of World War I, the dominant global currency has been the

Question 3

3 out of 3 points

Correct

The common monetary policy for the euro zone is now formulated by

Question 4

3 out of 3 points

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Undoubtedly, we are now living in a world where all the major economic functions—consumption, production, and investment

Question 5

3 out of 3 points

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Foreign-owned manufacturing companies in the world’s most highly developed countries

Question 6

3 out of 3 points

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Recent corporate scandals at firms such as Enron, WorldCom and the Italian firm Parmalat

Question 7

0 out of 3 points

Incorrect

Today for an MNC to produce merchandise in one country on capital equipment financed by funds raised in a number of different currencies through issuing securities to investors in many countries and then selling the finished product to customers in yet other countries is

Question 8

3 out of 3 points

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Privatization

Question 9

3 out of 3 points

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Most governments at least try to make it difficult for people to cross their borders illegally. This barrier to the free movement of labor is an example of

Question 10

3 out of 3 points

Correct

In David Ricardo’s theory of comparative advantage,

Question 11

3 out of 3 points

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Suppose you start with $100 and buy stock for £50 when the exchange rate is £1 = $2. One year later, the stock rises to £60. You are happy with your 20 percent return on the stock, but when you sell the stock and exchange your £60 for dollars, you only get $45 since the pound has fallen to £1 = $0.75. This loss of value is an example of

Question 12

3 out of 3 points

Correct

As capital markets are becoming more integrated, the goal of shareholder wealth maximization

Question 13

3 out of 3 points

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Since the end of World War I, the U.S. dollar has played the role of the dominant global currency, displacing the

Question 14

3 out of 3 points

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MNC stands for

Question 15

3 out of 3 points

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Suppose that you are a U.S. producer of a commodity good competing with foreign producers. Your inputs of production are priced in dollars and you sell your output in dollars. If the U.S. currency depreciates against the currencies of our trading partners,

Question 16

3 out of 3 points

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When money can move freely across borders, policy makers must choose between

Question 17

3 out of 3 points

Correct

In the United States, bimetallism was adopted by the Coinage Act of 1792 and remained a legal standard until 1873,

Question 18

3 out of 3 points

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The advent of the euro marks the first time that sovereign countries have voluntarily given up their

Question 19

3 out of 3 points

Correct

The Asian Currency Crisis

Question 20

0 out of 3 points

Incorrect

Put the following in correct date order:

Question 21

0 out of 3 points

Incorrect

The core of the Bretton Woods system was the

Question 22

3 out of 3 points

Correct

Following the demise of the Bretton Woods system, the IMF

Question 23

3 out of 3 points

Correct

To pave the way for the European Monetary Union, the member countries of the European Monetary System agreed to achieve a convergence of their economies. Which of the following is NOT a condition of convergence:

Question 24

3 out of 3 points

Correct

The Mexican Peso Crisis was touched off by

Question 25

3 out of 3 points

Correct

Put the following in correct date order:

Question 26

3 out of 3 points

Correct

Willem Duisenberg, the first president of the European Central Bank, defined “price stability” as an annual inflation rate of

Question 27

3 out of 3 points

Correct

The choice between the alternative exchange rate regimes (fixed or floating) is likely to involve a trade-off between

Question 28

0 out of 3 points

Incorrect

With regard to the current exchange rate arrangement between the U.S. and the U.K., it is best characterized as

Question 29

3 out of 3 points

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A booming economy with a fixed or stable nominal exchange rate

Question 30

3 out of 3 points

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Generally speaking, a country would be more prone to asymmetric shocks