LOS l: Identify and interpret macroeconomic and interest and exchange rate linkages between economies.
Q1. Which of the following statements regarding global economies is most accurate?
A) Developed economies are perfectly integrated but not emerging countries.
B) Neither emerging nor developed country economies are perfectly integrated.
C) Both emerging and developed country economies are perfectly integrated.
Q2. Which of the following would be consistent with Country A having higher interest rates than Country B?
A) Country A has a looser monetary policy and a faster growing economy.
B) Country A has a tighter monetary policy and a faster growing economy.
C) Country A has a tighter monetary policy and a slower growing economy.
Q3. Which of the following would indicate that a country is less affected by global events? The country is:
A) small and has an undiversified economy.
B) small and has a diversified economy.
C) large and has a diversified economy.
Q4. An analyst believes that a recession is likely to develop that will affect many of the world economies. She believes that Country A’s GDP should be forecast using current and lagged economic data for it as well as from other countries that may influence Country A. What type of country is Country A and what type of forecasting model should be used? Country A is most likely a:
A) large country and its GDP should be forecast using an econometric approach.
B) small country and its GDP should be forecast using a checklist approach.
C) small country and its GDP should be forecast using an econometric approach. |