5.

10.

11.

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Choose the correct statement/s related to currency appreciation :

a) Appreciation of a currency takes place when the supply of the currency is lesser than its
demand in the foreign exchange market.

b) Currency appreciation refers to the increase in the value of one currency with respect to
other foreign currencies.

९) Itisa feature associated with floating or managed floating exchange rate regimes.
d) All the above.
Hedging means:
a) Covering foreign exchange risk. b) Foreign exchange speculation.
c) Acceptance of foreign exchange risk.d) Foreign exchange arbitrage.
Who among the following developed the Purchasing Power Parity Theory ?
a) Marshall Lerner. b) Gustav Cassel.
c) David Ricardo. d) Adam Smith.

In case of H-O theorem, the most important cause of the difference in relative commodity prices

and trade between nations is :
a) Technology. b) Innovation.
c) Factor endowments. d) Foreign demand.

The market for foreign currencies is called :

a) Capital market. b) Foreign exchange market.
c) Stockmarket. d) Goods market.
4 is known as the Paper Gold.
a) US Dollar. b) Cheque.
c) Demand draft. d) Special Drawing Right.

International trade is based on the idea that :
a) Exports should exceed imports.
b) Imports should exceed exports.
c) Resources are less mobile internationally than are goods.

d) Resources are more mobile internationally than are goods.

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