If the Costa Rican government sets the exchange rate at 10 colon per U.S. dollar, then

the supply of Costa Rican colones will increase.

the supply of Costa Rican colones will decrease.

the quantity supplied of Costa Rican colones will decrease.

the quantity supplied of Costa Rican colones will increase.

the quantity demanded of Costa Rican colones will decrease.

2. Suppose interest rates rise in the United States, but they don’t rise in other nations. What is the impact on the flow of financial capital, the value of the dollar, and U.S. net exports (based on the changing value of the dollar)?

Capital Flow / Value of the U.S. dollar / Net Exports

Inflow / Appreciate / Increase

Inflow / Appreciate / Decrease

Inflow / Depreciate / Increase

Outflow / Depreciate / Increase

Outflow / Appreciate / Decrease

3. If the Kenyan government sets the exchange rate at 25 shillings per U.S. dollar, then the

supply of Kenyan shilling will increase.

supply of Kenyan shilling will decrease.

quantity supplied of Kenyan shilling will increase.

quantity demanded of Kenyan shilling will increase.

quantity demanded of Kenyan shilling will decrease.
 

.

Transcribed Image Text:

$/CRC $.25 $1 D1 01 Quantity of Costa Rican Colones (CRC) $/CRC $.25 $1 D1 01 Quantity of Costa Rican Colones (CRC)

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