1. Under pegged exchange rates, interest rate differences influence the movement of exchange rates.

a.True

b.False

2.Which transactions are recorded in the balance of payments?

A) Donations to charities based in another country

B) Payments of membership dues in international organizations

C) Transfers from citizens working abroad to their parents

D) All of the above

3.If a country has a balance of payment deficit, this means:

A) It exports less goods than it imports

B) It exports less goods and services than it imports

C) Its transfers send abroad exceed the transfers received

D) The sum of its goods exports, service exports, and transfers received is less than the sum of is goods imports, service imports, and transfers sent.