Econ 7.5

Which is the best description of a nation's Balance of Trade?

The difference between a nation's imports and exports.

The ___________________ is the accounting of all the international transactions of a nation.

balance of payments

Since 1971 foreign exchange rates in the United States have been

flexible.

A(n) __________ is determined by the supply and demand of that currency.

floating exchange rate

The ______ rate is the price of a nation's currency in terms of another nation's currency.

foreign exchange

The International Monetary Fund was created in 1944 in order to

manage the international monetary system of fixed exchange rates

Flexible exchange rates are determined by

supply and demand

A country experiences a ______ when the value of imports exceeds the value of exports.

trade deficit

A __________ dollar is able to purchase less foreign currency than a __________ dollar.

weak, strong

The ___________________ exists to promote world trade, to stabilize exchange rates, and to correct balance-of-payment deficiencies

International Monetary Fund

___________________ is anything accepted as a medium of exchange.

Money