Test: Open Economy Macroeconomics - 2


20 Questions MCQ Test Economics Class 12 | Test: Open Economy Macroeconomics - 2


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This mock test of Test: Open Economy Macroeconomics - 2 for UPSC helps you for every UPSC entrance exam. This contains 20 Multiple Choice Questions for UPSC Test: Open Economy Macroeconomics - 2 (mcq) to study with solutions a complete question bank. The solved questions answers in this Test: Open Economy Macroeconomics - 2 quiz give you a good mix of easy questions and tough questions. UPSC students definitely take this Test: Open Economy Macroeconomics - 2 exercise for a better result in the exam. You can find other Test: Open Economy Macroeconomics - 2 extra questions, long questions & short questions for UPSC on EduRev as well by searching above.
QUESTION: 1

Point out a merit of flexible exchange rate

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QUESTION: 2

Point out a demerit of fixed exchange rate

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QUESTION: 3

Point out a demerit of flexible exchange rate

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QUESTION: 4

A component of current account of the BOP account is

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QUESTION: 5

Currency depreciation occurs when

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QUESTION: 6

Currency appreciation occurs when

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Currency appreciation refers to the increase in the value of one currency against another.

QUESTION: 7

When currency becomes less valuable for the Rest of the world, it is called

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QUESTION: 8

Managed floating exchange rate is a system in which the

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Managed floating is a tool employed by the Central bank to restore the value of the country's currency in relation to other countries within the desired limits, even when the exchange rate is determined by the market forces of demand and supply.

QUESTION: 9

A component of capital account of balance of payment is

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QUESTION: 10

Which transactions determine the balance of trade?

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QUESTION: 11

Balance of trade is in surplus when

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QUESTION: 12

A deficit in BOP occurs

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QUESTION: 13

Devaluation is a

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Devaluation is the deliberate downward adjustment of the value of a country's money relative to another currency, group of currencies, or currency standard. Countries that have a fixed exchange rate or semi-fixed exchange rate use this monetary policy tool. It is often confused with depreciation and is the opposite of revaluation, which refers to the readjustment of a currency's exchange rate.

QUESTION: 14

Depreciation is a

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QUESTION: 15

When price of a foreign currency rises its supply also rises.

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QUESTION: 16

If exchange rate increases, this will make

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QUESTION: 17

The demand for foreign exchange and the exchange rate has

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QUESTION: 18

The demand curve for foreign exchange is

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QUESTION: 19

The supply of foreign exchange and the exchange rate has

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QUESTION: 20

The supply curve of foreign exchange is

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