Under a flexible-price monetary approach to the exchange rate ...

[debasdf]

Under a flexible-price monetary approach to the exchange rate
 
  A) when the domestic money supply falls, the price level would eventually fall, increasing the interest rate.
  B) when the domestic money supply falls, the price level would fall right away, causing a reduction in the interest rate.
  C) when the domestic money supply falls, the price level would fall right away, causing an increase in the interest rate.
  D) when the domestic money supply falls, the price level would eventually fall, keeping the interest rate constant.
  E) when the domestic money supply falls, the price level would fall right away, keeping the interest rate constant.

Question 2

Suppose that the U.S. Open ticket costs 100 and the British Open ticket costs 50 and the exchange rate is 1.43. How much does the British Open ticket cost for an American attending the British Open?
 
  What will be an ideal response?

[firehawk60]

Answer to Question 1

E

Answer to Question 2

1.43  50 = 71.50

[debasdf]

Correct answers!

[firehawk60]

Great! Please up vote