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Question
Which of the following refers to the bandwagon effect?A.Securities are purchased in one market for immediate resale in another.
B.Dominant enterprises exercise a degree of pricing power, setting different prices in different markets to reflect varying demand conditions.
C.Traders move like a herd, all in the same direction and at the same time, in response to each other's perceived actions.
D.Governments routinely intervene in international trade, creating tariff and nontariff barriers to cross-border trade.
E.The output of goods and services grows at a lesser rate than that of the money supply.
Answer
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Which of the following states that for any two countries, the spot exchange rate should change in an equal amount but in the opposite direction to the difference in nominal interest rates between the two countries?
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Which of the following occurs when a government increases the money supply?
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To express the PPP theory in symbols, let P$ be the U.S. dollar price of a basket of particular goods and P be the price of the same basket of goods in Japanese yen. What does the purchasing power parity (PPP) theory predict to be the equivalent of the dollar/yen exchange rate, E$/?
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C.E$/ = P/P$
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Q:
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Which of the following observations is true of technical analysis, an approach to exchange rate forecasting?
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C.When a firm imports products from a manufacturer and distributes them directly through retail outlets
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If a firm favors a push strategy, using direct selling to educate potential consumers about the features of its products, what kind of products would it most likely sell?
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Which of the following is true of the barriers to international communication?
A.Noise tends to increase the probability of effective communication.
B.Source effects can be beneficial for an international business when potential consumers in a target country have a bias against foreign firms.
C.Many international businesses try to promote positive source effects by deemphasizing their foreign origins.
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E.Research suggests that a consumer may use country of origin as a cue when evaluating a product, particularly if he or she has detailed knowledge of the product.
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According to research, when do consumers usually use the country of origin as a cue when evaluating a product?
A.When a firm tries to deemphasize its foreign origins
B.When consumers lack detailed knowledge of a product
C.When an advertising campaign stresses the positive performance attributes of a product
D.When a limited number of messages compete with each other for consumers' attention
E.When a firm resorts to personal selling instead of mass media advertising