Practice Exchange Rates And Currency (6) - International Economics - IB 10 Individuals & Societies

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8 questions

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6 sample questions

Question 1.
What is an exchange rate?
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Think about how countries trade currencies.
Question 2.
What is meant by currency appreciation?
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How much more can it buy?
3Question 3.
What describes a floating exchange rate?
- Set by the government
- Changes with market forces
- Stable over time
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Think about how markets respond to changes.
4Question 4.
True or False: A strong currency makes imports more expensive.
- True
- False
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Consider how strength affects purchasing.
Question 5.
How would a country's decision to switch from a floating to a fixed exchange rate impact its trade relations?
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Consider how each type of exchange rate responds to global market shifts.
Question 6.
Evaluate the effects of a sudden depreciation in a currency on inflation and consumer purchasing power.
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Think about how necessities and luxuries are imported.

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