Problems & Exercises for MACRO

Unit Four (for the Final Exam)

Unit Four--Assignment Two--Web Problem 5


Explain what would happen to the international value of the U.S. dollar in each of the following situations. Would the dollar appreciate or depreciate, and why?

1

The Fed raises the federal funds rate as it pursues a tighter monetary policy.


2

South Korean investors are attracted to the NASDAQ stock exchange and they invest billions of dollars in new Internet stocks.


3

Both France and the U.S. dive into a recession, but the U.S. recession is more severe.


Please send your responses by e-mail.

Congratulations! You have just completed your macroeconomics course. I hope you found it rigorous and challenging but not unreasonably difficult. Good luck on your final exam.


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