Exchange Rates

Identify the reason for the change in the AUD.

• Increase in demand for AUS exports

• Increase in demand for US imports

• Decrease in demand for US imports

• Decrease in demand for AUS exports

All of the following would result in the change shown in AUD, except for?

• Increase in demand for AUS exports

• Increase in Australian interest rates

• Speculation that the AUD is going to increase

• Increase in inflation in Australia

Identify the reason for the change in the AUD shown.

• Increase in AUS exports

• Decrease in overseas interest rates

• Increase in imports into AUS

• Decrease in Australian investment abroad

Identify the TWO impacts on the demand and supply of the AUD.

• Decrease in demand for AUD

• Increase in demand for AUD

• Decrease in supply of AUD

• Increase in supply of AUD

Identify the impact on the AUD.

• Appreciation

• Depreciation

• Both an appreciation and depreciation

• Neither an appreciation and depreciation

All of the following will occur as a result of an increase in commodity prices, except for?

• Export prices increase

• Demand for the AUD increases

• Appreciation of the AUD

• Depreciation of the AUD

Assume the AUD begins at point A. Where is the new equilibrium if there is an increase in demand for the AUD?

• A

• B

• C

• D

Assume the AUD begins at point A. Where is the new equilibrium if there is a decrease in imports into Australia?

• A

• B

• C

• D

Assume the AUD begins at point A. Where is the new equilibrium if there is an increase in interest rates in Australia and a decrease in Australian investment overseas?

• A

• B

• C

• D

Select TWO correct statements.

• An appreciation is beneficial for importers

• An appreciation is beneficial for exporters

• A depreciation is beneficial for importers

• A depreciation is beneficial for exporters