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Author Question: Refer to Figure 19-3. Which of the following isnottrue? (Read 432 times)

rl

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Question 1

Figure 19-3










Refer to Figure 19-3.  At what level should the Thai government peg its currency to the dollar to make Thai exports cheaper to the United States?


◦ greater than $.03/baht
◦ less than $.03/baht
◦ equal to $.03/baht
◦ $1/baht

Question 2

Figure 19-3










Refer to Figure 19-3.  Which of the following is not true?


◦ Thai imports from the United States are cheaper at exchange rates greater than $.03/baht than at the equilibrium exchange rate.
◦ The baht is overvalued at exchange rates greater than $.03/baht.
◦ To achieve an exchange rate greater than $.03/baht, the Bank of Thailand must buy surplus dollars with bahts.
◦ Thai exports to the United States are more expensive at exchange rates greater than $.03/baht than at the equilibrium exchange rate.


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Marked as best answer by rl on Mar 16, 2019

dpost18

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rl

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dpost18

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