Pretest

Question 1

The best time for Americans to import French cheese is when they can

Revolt · Accepted Answer

buy the most euros for US dollars.

Question 2

Which statements accurately describe a country’s currency? Choose three correct answers.

Revolt · Accepted Answer

The currency is easily divisible.; The currency has denominations.; The currency has a value that can change.

Question 3

It’s important for countries to exchange currencies so that goods from other nations can be

Revolt · Accepted Answer

traded.

Question 4

Each currency has a changing value relative to other currencies. This is referred to as a currency's _______.

Revolt · Accepted Answer

exchange rate

Question 5

Which of these factors would strengthen demand for a nation’s currency on the international market? Choose four correct answers.

Revolt · Accepted Answer

low unemployment rates; stability of government; high gross domestic product; victory in war

Question 6

What is an example of a country that makes use of another nation’s currency?

Revolt · Accepted Answer

Panama

Question 7

Which factor plays a role in establishing the value of a country’s currency?

Revolt · Accepted Answer

supply and demand

Question 8

If investors can earn 10 percent interest in an account in Mexico but just 3 percent in the United States, those investors will most likely

Revolt · Accepted Answer

want to invest in Mexico, which will cause the peso to appreciate.

Question 9

By devaluating the bolivar, the president of Venezuela has

Revolt · Accepted Answer

increased the number of bolivars needed to buy one dollar.

Pretest Answers